Is it illegal for American car dealers to Resale?

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Nope! Export Services – Car Export America

While you may be familiar with the American import rules for American car dealers (Here Are The Four Legal Ways To Import A Car To The United States). There aren’t any laws preventing in, you’ve still got to go through Customs of course. Now the overseas country in question will have their own rules and regulations, Euro-ENCAP conformity may be a problem, and you will be paying tax on the way in. Happy importing!

As many of you know, I am currently importing a 1990 Nissan Skyline GT-R to the United States. Well, just to be clear, I am not importing it. That task is being handled by a bunch of sailors, and longshoremen, and dockworkers, and port employees, all of whom are currently taking a union-mandated smoke break.

But anyway: someone is importing my Skyline GT-R to America. And if you followed me on Twitter, you’d know that my new car is just seven weeks away from reaching the United States. That means I have a lot of ground to cover if I plan to thoroughly document every part of the import process before the car shows up on U.S. soil, where it will inspire the following conversation among port staff:

Port Worker 1: Why the hell would anyone spend so much money just to import this crappy old Nissan?
Port Worker 2: I don’t know, but I think it’s time for our union-mandated smoke break!

So today, we start from the start: the laws, rules, and regulations that actually make it possible for me to bring this car to the United States. Based on the e-mails and Tweets and Facebook posts and text messages I’ve received over the last few days, I know a LOT of you are very interested in this. “How can you bring this non-conforming car into America?” you’ve asked me. “You? YOU?? A normal guy like the rest of American car dealers , a regular Joe Schmo, with a cell phone, and a couple of credit cards, and a desktop printer that occasionally makes unexplained noises in the night?”

Well, the answer is: it isn’t as difficult as you think. And today I’m going to prove that to you from a legal standpoint, as I’m going to detail the four legal channels you can use to import a vehicle to the United States of America. Special thanks to everyone who helped me gather the information for this column, and especially Japanese Classics, LLC, the importer and dealership in Richmond, Virginia, who is both a) importing my Skyline, and b) patiently answering all of my stupid questions about the import process. (“Will the car get wet?”)

Anyway, without further ado: here are the four legal channels you can use to import an automobile to the American car dealers .

1. Bring It Into Compliance

By far the most obvious way to legally import a vehicle into the United States is to simply bring it into compliance with U.S. rules and regulations. Unfortunately, “simple” is hardly the word to describe this process, as it’s easily the most expensive strategy on this list.

To start, bringing a non-conforming car into compliance with U.S. rules and regulations requires crash testing the car in order to prove that it meets U.S. safety standards. That means you can’t simply buy one example of the car you want to import: you have to buy several. And as you can probably guess, all will be destroyed in the ensuing crash tests. This alone can cost anywhere from tens of thousands of dollars to over a million, depending on the vehicle.

In addition to the crash tests, you’ll have to bring your car into compliance with other safety rules and regulations, too. A speedometer that only reads in kilometers must be converted to miles. Headlight angles must be checked to ensure they meet U.S. standards; if not, they’ll have to be replaced with ones that do. You’ll have to install orange reflectors on the front sides of the car, and red reflectors in back. You’ll also have to comply with regulations dictating positioning of the third brake light and the strength of the bumpers. And then there’s stuff you didn’t even consider, like the little chime that beeps when you don’t have your seatbelt on, and a device that limits fuel spillage in an accident. It all must be there, and converting a vehicle to meet these specifications alone can easily cost more than $10,000.

And all of this is assuming the car passes its crash tests. If it fails, you’ll have to add additional structural reinforcement in the doors, the roof, the bumpers, the front and rear ends, or possibly all of the above. So once you’ve spent tens – and potentially hundreds – of thousands of dollars just to destroy the vehicle you’re considering in government-mandated crash tests, you may need to spend thousands more to ensure it can pass.

The good news: once you’ve passed your crash tests, it’s over. There’s no re-testing, there’s no annual compliance procedure. It’s a massive expense, sure, but it’s a one-time expense – and once you’re certified, you can bring over as many cars as you want.

Unfortunately there’s another wrinkle involved before that happens. You see, the Department of Transportation isn’t the only federal agency that takes a look at non-conforming cars. Your imported vehicle will also need approval from the Environmental Protection Agency, which is interested in just how much your desired vehicle pollutes. While getting a pre-1995 vehicle to pass EPA regulations isn’t tremendously difficult, any car made in 1995 or later will need an on-board diagnostics (OBD II) system installed. In some cases, this can be prohibitively expensive, since many foreign-market 1990s vehicles were never manufactured with such a system in the first place.

And then there’s one more wrinkle: the great state of California, which I’ll cover below in section four.

But in spite the enormous expense associated with the process of bringing a foreign car into compliance, several vehicles have been legally imported this way over the years. For example: many car enthusiasts know about Motorex, who brought the mid-1990s “R33” Nissan Skyline GT-R into compliance at great expense – an interesting tale I’ll cover in greater depth in a future column. But Motorex isn’t the only importer to complete the undertaking: a New Mexico-based imported called Europa brought the Mercedes G-Wagen into compliance and sold them for years, long before Mercedes-Benz arrived with an official version in 2002.

2. The “Substantially Similar” Clause

If a vehicle is “substantially similar” to one that was already sold in the United States, then you can ignore everything I’ve said above and bring it right in.

Or at least, that’s the simple explanation. The reality is, of course, a lot more complicated.

The “substantially similar” clause is primarily aimed at vehicles coming in to the United States from Canada. Imagine this situation: let’s say you bought a Canadian-spec Toyota Highlander in Toronto, and then your job transferred you to the United States. Rather than going through the trouble and expense of selling your Canadian Highlander and buying another one in the States, you can simply claim your Highlander is “substantially similar” to a U.S. model – a claim that’s undoubtedly true, since Canada and the United States broadly share most emissions and vehicle safety regulations. You get a few forms, you sign a few papers, you submit a standard letter from the automaker, and boom! Your Highlander is now legal in the United States.

Unfortunately, enthusiasts are largely locked out of the “substantially similar” clause. The reason is that while Canadian cars largely conform to U.S. laws, vehicles from other markets do not necessarily share the same reciprocity.

I’ll give you an example to help illustrate my point. When I started this process more than six months ago, my initial plan was to import a late-2000s “E60” BMW M5 station wagon; the one with the huge V10 and that awful transmission; the one that felt like you were in the car with a 14-year-old whose only previous experience with a stick shift was driving a farm tractor through a hay field.

My thinking was this: although BMW never sold the M5 wagon in the U.S., they did sell the regular 5 Series wagon – and that means the M5 wagon’s body is “substantially similar” to a vehicle that’s already in compliance. Likewise, they never sold a wagon with that V10 – but they did sell a sedan with that engine, which makes the engine “substantially similar,” too. I figured I would merely need to find a car, change a few headlights, and I’d be on my way, cruising around America in a suave M5 wagon.

But here’s what I found out: although the V10 engine in the European-spec M5 is “substantially similar” the one in the American-spec model, the EPA can’t confirm that without conducting its tests. And although the body is substantially similar, the Department of Transportation doesn’t quite operate on the “See how similar it looks?” theory of government regulation. They, too, would need to run tests – crash tests, I mean – in order to prove that the car is in compliance with U.S. laws and regulations.

However: if you’re interested in a substantially similar car, there is one interesting way around these tests: all you need to do is get an automaker to write you a letter stating that the car is indeed substantially similar to a vehicle sold in the United States.

Now, this may sound like a long, tiresome process; a process where you speak to 20 different people and listen to hold music for the better part of a week, and eventually you just chew off your own thumb. But in reality, it’s common practice in the Toyota Highlander example given above. Just call an automaker’s customer service line, tell them you’re moving from Canada with your car, and you’ll probably get the letter.

But for a car coming in from Europe? Good luck.

The automaker has two major incentives not to write this letter. Number one: they don’t want some idiot spending big money on a foreign version of its product, when that person could just go buy a new one in the United States. And number two: they don’t want the liability of certifying the safety equipment of a foreign-spec vehicle – because the automaker would undoubtedly get sued if an accident took place.

So, a simple summary of the above paragraphs: unless you want to import a car from Canada that was already sold in the United States, you stand a very small chance of bringing it here under the “substantially similar” clause.

However, there is one glimmer of hope. In 2006, a highly reputable Registered Importer in Baltimore called JK Technologies managed to convince the government that the “B5” Audi RS4 Avant was “substantially similar” to the A4 and S4 Avant models already sold here by Audi (despite protests from Volkswagen of America). That means two things: number one, the 2000-2001 Audi RS4 Avant is indeed legal for importation under this clause, with a few minor modifications. And number two: it’s possible to import a cool enthusiast car under the “substantially similar” clause. But it’s very, very unlikely.

American car dealers

3. Show and Display

If you’re a car enthusiast in the United States, you’re probably familiar with the Show and Display rule: the law that Bill Gates got passed in order to drive a Porsche 959 in America.

In reality, the history of the Show and Display law is a little more complicated. For one thing, it wasn’t just Gates who wanted the law passed, but actually several wealthy American car enthusiasts – including Ralph Lauren and Otis Chandler, former publisher of the Los Angeles Times.

Eager to drive the 959 and various other rare vehicles never offered in the United States, the group banded together and hired an attorney in Washington, D.C., to approach the EPA, the NHTSA, and major automakers in order to come up with a “Show and Display” rule – essentially a law that allows certain unique vehicles to be exempted from the government’s stringent rules and regulations, provided they are brought over solely for purposes of “show and display.”

The law was eventually passed in 1999, and it exempted certain unique vehicles from the federal government’s challenging regulations and rules surrounding motor vehicle safety. In other words: No crash tests. No side marker lights. No headlight swaps. No seat belt chimes. Contrary to popular belief, however, vehicles imported under the “Show and Display” exemption must still conform to EPA rules and regulations – but that’s the easy part. And most importantly, it’s better than nothing.

But here’s the problem with Show and Display: it does not apply to you.

What I mean by this is, Show and Display was primarily designed solely to apply to the most unusual, rarest, and most expensive vehicles on the planet. In fact, the U.S. government maintains a list of vehicles it has approved for Show and Display – and the list includes cars like the Aston Martin One-77, the Bugatti EB110, the McLaren F1, and the Mercedes CLK-GTR. Likewise, it maintains a list of vehicle it has denied under Show and Display – and that list includes cars like the Mazda Cosmo, the Lotus Elise S1, the Audi RS2, and virtually every standard variation of the Nissan Skyline GT-R that you can possibly imagine.

American car dealers

Essentially, for a American car dealers to pass Show and Display scrutiny, the rules are these. Number one, it must never have been offered for sale in the United States. Number two, it must be out of production. Number three, it cannot be a replica or a kit car. And number four, production cannot exceed 500 examples. Admittedly, there are a few exceptions to these rules, but this is the general gist of it.

Beyond those strict guidelines, the government imposes a few additional measures on Show and Display vehicles. First: you can’t sell the car without written approval from the NHTSA, as they don’t want Show and Displayers turning into profiteers. After all, the government probably figures, these cars are for show and display not import and profit. And second: you’re limited to 2,500 miles per year. No cross-country roadtrips in your Bugatti EB110.

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4. Make Sure It’s 25 Years Old

Here’s the crazy thing about all these regulations. After all the words I’ve written above; after all the EPA restrictions, and DOT regulations, and crash tests, and bumper strength laws; after all the rules and guidelines and mileage limits; after all that … the day a car turns 25 years old, it’s legal to import, with no restrictions at all.

And I mean 25 years old. And I mean no restrictions.

Seriously: if a car is 24 years and 11 months old, you’d better bring it into compliance or else risk it getting crushed into a cube the size of a surge protector. But the moment it turns 25 years old, anything goes. No seat belts? No problem. No headlights? No problem. You want to import a Nissan Figaro with a big block Chevy V8 and windows tinted so dark that they look like one-way mirrors? As long as it’s 25 years old, no problem. Bring it in, with only one caveat: it needs to be using its original engine, or one that was already EPA certified.

This is how I’m importing my Skyline GT-R. Since the first “R32” GT-Rs were manufactured in August 1989, they became 25 years old – and thus fully legal – in August 2014. No crash tests, no headlight changes, no EPA certification. My car is a January 1990 build, which means it’s legally importable as of January 2015. And that means it’ll be ready to go when it comes off the boat in March.

There are only two exceptions to this little rule. Number one: your own state laws might have something to say about a car, 25 years old or not, without safety items like seat belts and headlights. So even though you’re exempt from federal laws on the subject, you still have to comply with your own state rules and regulations. Some states have no inspection, so this isn’t a problem – but in Virginia (where the American car dealers will be arriving) and Pennsylvania (where I live), I had better have seat belts, or I won’t get plates.

Exception number two: the great state of California, whose emissions laws are stricter than the federal government’s. You see, while the EPA exempts vehicles on a rolling 21-year basis, meaning that anything age 21 or older is exempt from federal emissions laws, California laws start with all vehicles manufactured after 1975. In other words: if your car is newer than 1975, and it was never originally certified to operate in California, you must go about getting it certified there – even if it’s already legal in every other state. Since this process can cost thousands of dollars, I won’t be doing this – which means my car can’t go to a American car dealers in California.

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