Exports of used cars rise on policy steps

The company landed its first order at the end of 2020 with an Eastern European buyer who originally intended to procure automotive batteries, Shi said. The client, however, ended up buying six used NEVs produced by China's leading EV maker BYD after learning that the price of the two items was about the same.

Shi also took the initiative to reach out to others to secure more orders.

In September 2021, the Tianjin municipal government launched an overseas exhibition for used cars of Chinese brands in Dubai, in which the company, together with eight peers, signed up to showcase 27 vehicles.

The exhibition was intended to last three months, but all the cars on display were sold in less than a month.

This was much better than expected as their foreign counterparts were mostly selling luxury brands from Europe and Japan like BMW, Mercedes-Benz and Lexus, Shi said.

The company sold more than 200 used cars in 2021, while the number surged tenfold to over 2,000 in 2022.

As its footprint expanded in Dubai, Ukraine, Kazakhstan, Uzbekistan, Poland, Bulgaria, Georgia and other countries, a 500 percent year-on-year increase in the sales of used cars was registered in the first four months, according to Shi.

Luo Lei, deputy secretary-general of the China Automobile Dealers Association, said that exports of used cars from China, especially gasoline cars, did not have much of a price advantage in the international market.

In recent years, however, many countries have set higher tariffs on petrol- or diesel-used vehicles while placing almost no tariff on second-hand NEVs, Luo said.

China, as the world's largest producer of electric vehicles, has ample quality supply in the pipeline, which strongly boosts exports of used NEVs, Luo added.

Further, the average price of used cars has increased significantly over the years, from less than $5,000 per unit in 2019 to nearly $15,000 in 2021, largely due to the better quality of homegrown brands, Luo said.

Used car exports in developed countries occupy a 10 percent share of its total used car transactions. China's used car exports are expected to surge to millions of units per year in the future, considering the fact that annual sales of second-hand vehicles in China stand at 17 million on average currently, Luo said.

However, the country's used car export business remains in the early stages of development. Greater government support should be channeled to the sector to help more companies survive and thrive, company executives said.

Shi of Tianjin Cinko Vehicle Logistics said a robust capital chain is a matter of life and death for enterprises involved in this capital-intensive industry.

All departments concerned should roll out more preferential policies to allow financial institutions to strengthen support for companies in the sector at a lower cost.

In addition, used car exports are at the downstream end of the auto industry chain.

The government should establish more platforms to help match demand for acquiring used cars with upstream companies such as large-scale State-owned leasing companies and ride-hailing firms more efficiently, Shi added.

Although the scale of exports of used cars in China still remains modest compared to countries like the United States and Japan, the country, as the world's largest producer and consumer of automobiles, is well positioned to tap into the potential with ample supply of used cars, said Xu Hongcai, deputy director of the economic policy committee at the China Association of Policy Science.

China had more than 412 million registered vehicles by the end of last year, the largest fleet in the world.

The number of registered new energy vehicles, in particular, hit 13.1 million, according to the data from the Ministry of Public Security.

"It's just a matter of time before more of them are resold. The quality of Chinese cars has also improved to the point where many developing-world consumers may well choose them as a cheaper alternative to used Toyotas or Fords," Xu said.