What is Salvage title? Export cars from the U.S.

Importing Second Hand Car (Used or Salvage) in South Korea from the United States

By Mike Richards Updated: 01/31/2023 Posted: 10/24/2016

Thanks to the recent full implementation of the Korea-U.S (between these countries was established contact). Free Trade Agreement (KORUS), the prospects for importing used and salvage vehicles (“second hand” cars) in South Korea from the United States have never been better. This is due in no small part to the total elimination of import duties on both used and new vehicles imported into South Korea from the United States in comparison with the past.

Even though there may be no import duties, though, that doesn’t mean the process isn’t complex! That’s why we’re going to review everything you need to know if you want to import a used car from the United States into South Korea. We’ll discuss the customs clearance process for both the U.S. and South Korea, and we’ll even discuss how you can register your vehicle (or vehicles) once they arrive overseas. Needless to say, if you’ve been looking for a definitive guide to importing used U.S. vehicles into South Korea, you’ve come to the right place!

Purchasing Used Vehicles at U.S. Online Car Auctions

If you’re looking to save as much money as possible when purchasing a used or salvage vehicle in the United States, then the best option is undisputedly online used car auctions. When working with a website that offers access to online used car auctions, you stand the chance to save up to 70 or even 80 percent on the total price of a used or salvage vehicle.

The best part about working with such a website is that it’s just as easy as using an online auction to purchase any other kind of item. You merely need to create an account and make a deposit. In the case of online used car auctions, your deposit will reflect 10% of your total maximum bid, e.g. a $100 deposit would empower you to bid up to $1000 on used and salvage U.S. vehicles.

After creating an account and making a deposit, you gain access to an extensive database of used car auctions taking place throughout the United States. You’ll also be connected with an auction broker or agent, who can hold your hand through the entire process. In addition, this agent or broker can also give you access to a number of used car auctions that cannot be publically displayed through the online used car auction provider’s website. With that kind of power, you should have no problem finding the used vehicle or vehicle that is right for your needs!

Shipping a Used or Salvage U.S. Car to South Korea

When shipping a used U.S. vehicle to South Korea, you will have two primary shipping options. The first is traditional container shipping, and the second is something called RORO shipping. RORO shipping is a great option if you’re looking to cut shipping expenses and increase convenience, as your used vehicle will literally be rolled onto the boat at the departure port and then rolled off once it arrives in South Korea.

Do note, though, that RORO shipping does create the prospect of your vehicle becoming damaged during the shipping process. This could be caused by your vehicle’s exposure to the elements, as a container will not be there to protect it. In addition, it is sometimes necessary for a RORO vehicle to be moved during transit, which does open up the possibility of damage being caused by human error.

Whatever method you choose, you should have no problem finding a minor or major U.S. port that offers shipping service to South Korea.

As a major trading partner of the United States and one with which there is a free trade agreement, ships are regularly passing back and forth between the two countries.

Surrounded on all three sides by water, there are a number of places in South Korea to which you can ship your used U.S. vehicle. However, if you’re looking to work through the primary port in the country, then you’ll absolutely want to ship your vehicle to the Port of Busan. By far the most important port in the country, the Port of Busan is also the sixth-busiest port in the entire world.

If you’d like to learn more about The Port of Busan, you can visit its official website right here. The Port of Incheon, located on the northwest coast of South Korea near Seoul, is also another option if you’re looking for a major container port. If you’d like to learn more about this port, you can consult its official website here.

Clearing Your Used Vehicle Shipped to South Korea Through U.S. Customs

Before shipping your used vehicle to South Korea, you will first need to clear U.S. Customs. Thankfully, this is a relatively straightforward process, only requiring a few small things.

First, you will need to collect your vehicle’s original Certificate of Title along with one of the following. Your first option is to get a certified copy of that Certificate of Title. Alternatively, you can create two complete copies of your original Certificate of Title.

Once you have the above, you will need to present the documents and your vehicle to U.S. Customs at your port of departure at least 72 hours in advance of your ship date. To find out where you will need to present your vehicle and documentation at your port of departure, simply get in touch with the Port Director.

After U.S. Customs has possession of your vehicle and documentation, they will check a few things. First, they will make sure that the VIN number and engine number correspond to what’s present on the Certificate of Title. Second, they will inspect the vehicle to ensure that there are no illicit substances or objects secreted away. Provided everything checks out, the vehicle will be cleared and then loaded onto the ship.

Should you have any additional questions about the process for clearing your used U.S. vehicle being shipped to South Korea, please consult the official website for U.S. Customs and Border Protection here.

Getting Your Used or Salvage Car Through South Korean Customs

Thanks to the free trade agreement that exists between South Korea and the United States, clearing a used U.S. vehicle through South Korean customs is a simple process. Once the vehicle has arrived at the port, the following documentation must be presented:

  • Original Certificate of Title
  • United States Vehicle Registration (original)
  • Original Bill of Landing
  • Proof of Insurance (Either an Original or a Copy of the Policy)
  • An Inventory of Vehicle’s Technical Specifications (what type of fuel – petrol or diesel, etc.)

While the documentation is straightforward, note that the vehicle will be subject to a number of tests once it arrives. First, the vehicle will be subject to an emissions test. Second, the vehicle will be subjected to a noise and vibration test. South Korea’s Ministry of the Environment conducts both of these tests. For a more detailed overview of the technical requirements of each test, you can consult South Korea’s Ministry of the Environment’s official website here.

For further questions about the process of clearing your used U.S. vehicle through South Korean customs, please consult the official website for the Korea Customs Service here.

Import Duties and Taxes for U.S. Vehicles Imported into South Korea

In 2012, the United States and South Korea began the first new free-trade agreement for the United States since the implementation of the North American Free Trade Agreement (NAFTA). This agreement, known as the Korea-U.S. Free Trade Agreement (KORUS), has had a beneficial impact on the exportation of used and salvage U.S. vehicles to South Korea thanks to total elimination of import duties. (Note that this elimination of import duties officially went into effect in January of 2016; the duty had previously been at 4% for the first four years of the agreement.)

Although there is no import duty for used U.S. vehicles imported into South Korea, all vehicles are subject to a variety of taxes:

  • For vehicles imported into South Korea and subsequently sold, there is a 5% individual consumption tax that is based upon the CIF (Cost, Insurance, Freight) value of the vehicle. In addition, there is a 10% Value Added Tax (VAT) assessed on the customs-assessed value of the vehicle plus the above individual consumption tax.
  • If the vehicle is imported for the purpose of ownership, there is an annual vehicle tax. Based on the size of the engine. This tax is 80 Won per cc for vehicles with 1000 cc engines. Below 140 Won per cc for vehicles with 1000 cc engines to 1600 cc engines. 200 Won per cc for vehicles with engines larger than 1600 cc. In addition to the annual vehicle tax, there is also an annual vehicle education tax that is equivalent to 30% of the assessed annual vehicle tax outlined above.

When registering your imported used U.S. vehicle in South Korea, there are more taxes assessed. The first is an acquisition tax. Which is equivalent to 7% of the vehicle’s value exclusive of the VAT outlined above. In addition, you will be required to pay a subway bond, which is based upon the vehicle’s engine displacement:

  • 1000 cc and Below: 0%
  • Between 1000 cc and 1500 cc: 9%
  • Between 1500 cc and 2000 cc: 12%
  • Greater than 2000 cc: 20%

Should you have any further questions about import duties and taxes for used U.S. vehicles imported into South Korea, please consult the official website for the Korea Customs Service here.

How to Register an Imported Used Car in South Korea

After importing your used or salvage vehicle into South Korea, begin the registration process as soon as possible. In fact, you have only 15 days to do so before your vehicle could become subject to impound or deportation.

Registration is handled by local Car Registration Centers. A simple Internet search will find the correct office for your particular “gu” in South Korea. At this office, you will present the following documents:

  • Vehicle Registration Application (Ja Dong Cha Deung Lok)
  • Import Certificate (Supplied by South Korean Customs)
  • The Original Vehicle Plates from the United States
  • Your Certificate of Title (original)
  • The original copy of the United States Vehicle Registration
  • Proof of Insurance

To learn more about the process of registering your vehicle in South Korea, visit the registration authority’s official website. Note that this website is only offered in Korean. However, if you speak and read the language, then you can handle much of the registration process through this portal.

For general questions regarding vehicle registration in South Korea, please consult the official website for KoROAD. Should you need assistance in obtaining a South Korean driver’s license, you can consult the Road Traffic Authority’s website here.

The Used Car Market in South Korea

One would expect the implementation of KORUS would strengthen the market for imported used U.S. vehicles in South Korea. However, the opposite is somewhat true.

The market for imported used vehicles from the United States and elsewhere has been quite volatile in recent years.

At the center of this volatility are South Korean laws and regulations surrounding the environmental impact of vehicles. Perhaps more so than any other country, South Korea has taken tremendous steps to limit carbon emissions. While good for the environment, this has increased the price of passenger vehicles in the country. The recent scandal involving Volkswagen (which admitted to cheating emissions tests for over 10 million vehicles around the world). Has led to a drop in demand for all imported vehicles, new and used, in South Korea.

The above and other barriers to trade should be cause for concern when importing used U.S. vehicles into South Korea. However, despite the recent drop in demand, there’s reason to be optimistic. As more hybrid and electric vehicles become available in U.S. second-hand markets, these vehicles could become profitable candidates for export to South Korea.

The Most Popular Used Vehicles in South Korea

Hyundai and Kia have a veritable stranglehold on the South Korean new and used automotive markets. Overall, Hyundai owns the top two positions in terms of popularity with its Porter and Avante models. The Sonata and Santa Fe also find a place in the top 10 in terms of popularity. Landing in fourth and sixth place respectively. Outside of Hyundai, every other spot in the top 10 (with one notable exception discussed below) belongs to Kia. The most popular of Kia’s makes is the Sorento. Landing at third on the list, with the Morning, Carnival, Bongo, and K7 rounding out the top 10.

Speaking again of the opportunity that exists for the export of used U.S. electric and hybrid vehicles to South Korea. The Chevrolet Spark is worthy of note.

In 2016, this vehicle has found itself fifth on the list of the 10 most popular vehicles in South Korea. In fact, sales for this particular vehicle increased over 50% year-over-year.  Kia K7 growth in popularity exceeds this figure, manufactured in South Korea. As far as American makes are concerned, the Spark is the only one to rate in the top 20. With the Chevrolet Impala landing just outside the 21st.

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