China cracks down on exports of ‘zero mileage’ new cars exported as used

BANGKOK (AP) – China has moved to crack down on exports of “zero mileage” new vehicles being exported as if they are used, a tactic that has allowed some of its automakers to exaggerate their sales data and claim tax rebates and other benefits.

The tighter regulations apply to exports of cars within 180 days of when they are registered.

China has become the world’s largest exporter of vehicles as its automakers struggle with excess competition in their home market. The “zero mileage” auto exports are thought to distort sales data to make it look as if more of that excess inventory is being sold.

Overseas buyers of such vehicles often are unable to get aftersales services or parts for repairs, damaging the brand image of some Chinese automakers that have been pushing for tighter regulation of exports, the ministry said.

The new rules target falsified registration and export documents and violations of regulations in both China and countries that import the vehicles.

Beginning Jan. 1, automakers will have to provide formal guarantees of after-sales service and information about where such services can be obtained, according to the regulations posted on the Commerce Ministry’s website.

The report did not name any specific automakers, though such exports have been reported for various provinces across the country.