The used car market in Saudi Arabia is exceptionally strong, particularly as it relates to second-hand vehicles manufactured in the United States. As such, many would-be entrepreneurs are highly interested in what’s involved in importing used vehicles from the United States into Saudi Arabia.
To be sure, there’s money to be made in this venture. However, the rules pertaining to the importation of used vehicles in Saudi Arabia can be quite complex. You should know How To Check Vehicle Registration in Saudi Arabia. Below, you can see guide we’re going to review everything you need to know, paying particular attention to Saudi Arabia’s rules regarding customs duties and taxes, as well as the country’s import restrictions. In addition, we’ll discuss your shipping options, as well as what opportunities exist in the Saudi Arabian used car market.
Purchasing Used Vehicles at U.S. Online Car Auctions
If you’re looking to get the best deal possible on used cars in the United States, your best option is unquestionably online used car auctions. Through sites that provide this service, you can gain access to used car auctions taking place across the United States each and every day. Doing this presents you with the opportunity to save massively on the price of a used vehicle!
To get started, you’ll only need to create an account (according to policy of site) and then make an initial deposit. This deposit is necessary in order to establish your maximum bid, with the deposit’s size most often equaling 10% of whatever your maximum bid can be. (This would mean that a $500 deposit would entitle you to bid up to $5000 on used U.S. vehicles.)
After creating an account (its like license for using site), you will be able to browse the extensive database of used car auctions available through the website. In addition, you will also be connected with an auction agent who can help you determine appropriate bids and even connect you with U.S. used car auctions that cannot be publically displayed online.
As you browse different auctions, though, do please keep this in mind. If your goal is to export a used U.S. vehicle to Saudi Arabia, then it must be one that has not previously been in an accident. Saudi Arabia expressly prohibits the import of such vehicles.
Shipping a Used U.S. Vehicle to Saudi Arabia
Because of the close economic ties between Saudi Arabia and the United States, you should have no trouble when it comes to locating a port from which you can ship your used U.S. vehicle. The only real choice that you’ll have to make is between container shipping or RORO shipping, which stands for “roll-on roll-off”.
Without a doubt, RORO shipping is the cheaper and more convenient of the two options. However, take heed when opting for this method when shipping used U.S. vehicles to Saudi Arabia. Given that Saudi Arabia prohibits the import of used vehicles with visible body damage, the possibility of damage occurring to your vehicle while in transit (due to its exposure to the elements or human error) is something to keep in mind. That said, if you’re willing to accept the risk, the savings you stand to gain on shipping are significant.
The two main ports to which used U.S. vehicles can be shipped to Saudi Arabia are the Jeddah Islamic Port (JIP) and the King Abdulaziz Port Dammam. The Jeddah Isalmic Port is located along the west coast of the country and is serviced through the Red Sea. The King Abdulaziz Port Dammam, by contrast, is located on the country’s east coast and offers service from the Persian Gulf. Those looking to gain access to the country’s capital, Riyadh, will prefer to use the latter port.
For more information about the Jeddah Islamic Port, you can visit its official website here. For more information about the King Abdulaziz Port Dammam, you can visit its official website here. In addition to these two major container ports, there are also a number of other ports along both of the country’s coasts that can offer service for vehicles arriving by RORO shipping and some container ships.
Clearing Your Used Vehicle Shipped to Saudi Arabia Through U.S. Customs
When shipping your used U.S. vehicle to Saudi Arabia, you will first need to clear U.S. customs at your chosen port of departure. To do so, you will first need to ensure that you have your documentation in order. This documentation must include your vehicle’s Original Certificate of Title along with one of the following:
- One (1) certified copy of the Original Certificate of Title OR
- Two (2) complete copies of the Original Certificate of Title
The above documentation along with the vehicle must be presented to U.S. customs at your chosen port of departure at least 72 hours before your scheduled ship date. To find out where exactly you will need to present your vehicle and documentation to customs, please consult the Port Director at the departure port you have selected.
Once in the hands of customs, a few things will be evaluated. Customs agents will check your documentation and ensure that it accurately reflects the Vehicle Identification Number (VIN) and engine number of the car presented. In addition, customs agents will inspect the vehicle thoroughly to see if there is any contraband secretly stowed away. Provided that the vehicle is clean and the documentation checks out, the vehicle will be cleared and then loaded onto the ship.
Should you have any questions about customs clearance that pertain to your vehicle’s specific circumstances, please contact U.S. Customs and Border Protection directly by visiting their website here.
Getting Your Used Vehicle Through Customs in Saudi Arabia
Before getting to the documentation that will be required in order to clear your used U.S. vehicle through Saudi Arabian customs, it’s important to take a look at the numerous restrictions that the country places upon the import of used U.S. vehicles. First and foremost, in order to import a used U.S. vehicle into Saudi Arabia, you must be:
- A Saudi Arabian citizen (with a valid Iqama)
- Or citizen of another Gulf Cooperation Council (GCC) nation, which includes Kuwait, Qatar, Bahrain, the United Arab Emirates and Oman
Provided you meet the above requirements, you are permitted to import one used vehicle per calendar year. In order to import more than one vehicle per year for the purpose of selling those vehicles, you must be registered as the operator of an importer and reseller of vehicles. In addition, vehicles with more than five seats can only be registered by commercial businesses.
Beyond these basic requirements, there are a number of other notable restrictions placed upon used U.S. vehicles imported into Saudi Arabia. These include:
- The vehicle’s steering wheel must be on the left-hand side. Note that the vehicle must have been manufactured this way. Vehicles that have been converted from right-hand side to left-hand side steering wheels are prohibited.
- Any vehicle that has previously been involved in an accident cannot be imported into Saudi Arabia. This includes accidents involving other motor vehicles, as well as accidents involving flooding, fire, rollovers and others.
- There should be no visible damage to the vehicle’s body. In instances where damage occurs to the body during transit or while in port, a certificate that attests to this damage must be filed with customs. The damage must then be repaired.
- Vehicles that have previously been used as taxi cabs or as police vehicles are prohibited from importation.
- Used, refurbished or rebuilt auto parts are prohibited from importation.
Provided that the vehicle and its owner meet all of the above requirements, the following documents will be required by Saudi Arabian customs:
- Original Certificate of Title
- Original United States Vehicle Registration
- Certificate of Origin
- Certificate of Conformity
- Original Bill of Landing
- Proof from U.S. Authorities that Vehicle Was not Used in a Crime
- Export Form
- Proof that the Vehicle in Question is Debt Free
- Assessment of Vehicle’s Value from U.S. Customs
In instances where the person who is importing the vehicle is not the registered owner of the vehicle, the importer must present proof of power of attorney to Saudi Arabian customs.
For more information about clearing your used U.S. vehicle through Saudi customs, you can consult the Ministry of Finance’s official site for customs here.
Import Duties and Taxes for U.S. Used Vehicles Imported into Saudi Arabia
When importing a used vehicle from the United States to Saudi Arabia, you will subject to an import tariff of 10% for both passenger automobiles and light trucks. While this seems relatively straightforward, it’s worth noting how the value of the vehicle is calculated by Saudi customs.
To start, the price of the vehicle at the time of original sale is taken into account. From there the value of the vehicle is depreciated in the following manner:
- A vehicle is considered new until six months have elapsed since its date of manufacture.
- Between sixth months and one year, a vehicle’s value is depreciated by 2%.
- After one year, a vehicle is depreciated in value by 1% for every month since its date of manufacture.
- For vehicles five years and older, the maximum percentage by which a vehicle’s value can be depreciated is 60%.
As an example of the above, consider a used U.S. vehicle valued at $10,000 when sold. The percentage for depreciation assessed by Saudi Arabia would be 14% — 2% for the second half of its first year, and then 12% for each of the 12 months of its second year.
Beyond the import duties imposed on used U.S. vehicles imported into Saudi Arabia, there are no taxes assessed at the time of customs clearance. Should you have any additional questions about Saudi Arabia’s customs duties for imported U.S. used vehicles, this website is an excellent resource.
How to Register an Imported Used Car in Saudi Arabia
The Ministry of the Interior oversees the vehicle registration process in Saudi Arabia. In order to register your imported used U.S. vehicle, you will need to present your vehicle along with the following documentation to a local office:
- A Completed Application for Registration
- Customs Card for the Vehicle
- Proof of Payment for Import Duties
- Original Certificate of Title
- Original United States Vehicle Registration
- Resident Permit or Civil Affairs Identification
In addition to providing the above documentation, you will also be required to pay a registration fee, which is typically 150 Riyals. Once paid, the vehicle’s registration will be valid for three years. During the final year of registration, a renewal can be conducted through this website.
For more information about the process for registering your imported used U.S. vehicle in Saudi Arabia, you can consult the official website for the Ministry of the Interior right here.
The Used Car Market in Saudi Arabia
Saudi Arabia is home to one of the strongest economies in the entire world, and this is absolutely reflected in its automotive market. In fact, there is an average of one passenger vehicle per Saudi Arabian household according to statistics provided by the U.S. Department of Commerce and the International Trade Administration. To keep up with demand, the import of both new and used vehicles has been seeing a steady annual increase of around 4% for the past several years.
Sedans are the most popular kind of vehicle with Saudi Arabians, making up about 75% of the country’s automotive fleet overall. In distant second, four-wheel drive vehicles make up about 20% of the country’s automotive fleet. Of particular interest to someone looking to export used U.S. vehicles to Saudi Arabia is this: larger households in the country have been shown to have a much stronger preference for American makes and models, as opposed to those from European and even Japanese manufacturers. In addition, the majority of vehicles in the country (around 59%) are older than 15 years.
Overall, the used car market in Saudi Arabia is mostly supplied by imports from the United States, with imports from Germany making up much of the rest. However, when seeking entry into the Saudi Arabian used car market, one should note that demand for imported used vehicles is contracting overall. This is due in large part to the increasing availability of financing and leasing options for new vehicles in the country.
The Most Popular Used Vehicles in Saudi Arabia
Vehicles that are manufactured by the United States’ big three – General Motors, Chrysler and Ford – are among the most popular and sought-after vehicles with car buyers in Saudi Arabia. Of the three, Ford is perhaps the most popular, with its Explorer and Taurus models seeing strong demand in recent years. Chevrolet vehicles, particular performance ones, also enjoy strong demand among Saudi Arabians. In the Sports Utility Vehicle department, there’s always a strong interest in GMC Yukons and Suburbans.
While American makes remain exceedingly popular, it’s worth noting that Japanese makes (which are readily available through U.S. used car auctions) are gaining ground. In fact, the Toyota Hilux was the most purchased vehicle in Saudi Arabia over the past year, with the fuel-efficient and low-cost Toyota Yaris also enjoying strong sales. In addition to vehicles from Toyota, Hyundai has also performed well in recent years, with its Elantra and Accent models enjoying particularly robust sales themselves.
See our Vehicle Auctions, Car Auctions and Education Centre.
Comments