Driving into America: The Winding Import Path of Chinese Electric Vehicles

Driving into America: The Winding Import Path of Chinese Electric VehiclesWhile legally available Chinese electric vehicles (EVs) are scarce in the US market, enthusiastic car enthusiasts are finding ways to get them on American roads, navigating a complex landscape of challenges and workarounds. John Karlin, a registered nurse and quality process analyst, is one of them

Driving into America: The Winding Import Path of Chinese Electric Vehicles

While legally available Chinese electric vehicles (EVs) are scarce in the US market, enthusiastic car enthusiasts are finding ways to get them on American roads, navigating a complex landscape of challenges and workarounds. John Karlin, a registered nurse and quality process analyst, is one of them. In the summer of 2021, an article highlighting the Wuling Hongguang Mini EVs sales surpassing the Tesla Model 3 in China caught his attention. The absence of this $5,000 micro-EV in the US market piqued his interest: It's the best-selling EV in the world, but you can't buy it in America. Why can't I get one?

This question launched Karlin on a lengthy import journey. He contacted a Chinese dealer through Alibaba, and three months later, a high-spec Wuling Hongguang Mini EV (Macaron version specified in the original text, corrected here to Mini EV for context) arrived on the US West Coast. Collecting it from Freeport, Texas customs was a nerve-wracking experience; he suspected he might be the first American to import this model. Fortunately, customs clearance went surprisingly smoothly. He towed the vehicle back to Oklahoma City, registered it, obtained insurance, and began using it for his daily commute.

Karlins experience, while not unique, highlights the predicament facing Chinese EVs in the US market. Brands like BYD and NIO have achieved significant success in Europe, Africa, Asia, and Latin America, yet they face an island situation in the US. In 2023, Mexico sold 135,000 Chinese cars, representing about 10% of the market, while the US market has zero Chinese brands on sale, with only a handful of Chinese-made EVs or hybrids produced by Polestar, Volvo, and Ford.

Many Chinese companies had planned to enter the US market, given its status as the world's largest automotive market. However, high costs, multiple pressures, and the 25% import tariffs announced by the Trump administration in March 2023, have stalled these plans. The seemingly viable parallel import route is effectively blocked by the 1988 Imported Vehicle Safety Compliance Act. This act, designed to address the influx of Japanese and European cars at the timea situation mirroring the current potential competition from Chinese EV brandsmandates that all imported vehicles undergo expensive and time-consuming safety crash and emission tests through NHTSA-certified importers; an insurmountable hurdle for individual importers.

The only exception is the "25-year-old vehicle clause": vehicles over 25 years old are exempt from certification. Derek Weldon, owner of Pacific Coast Auto, explains that while places like California have additional regulations, in most cases, 25 years is the magic number. However, the surge in the Chinese EV industry began within the last decade, meaning no model qualifies. "Unless the vehicle was manufactured before 2000," Weldon says, "but China wasn't making EVs then."

Despite the barriers, some compliant pathways exist, albeit with stringent limitations. Karlin discovered in 2021 that states like Texas and Oklahoma have special safety regulations for low-speed vehicles not permitted on highways. These typically include street-legal golf carts or utility vehicles. He found that the diminutive Wuling Hongguang Mini EV could fall under this category. Equipped with a reversing camera and parking sensors, its safety features surpassed typical low-speed vehicles. By limiting its top speed to 35 mph (56 km/h), he successfully registered it in Oklahoma as a "low-speed vehicle" for daily commuting.

Another exception allows non-US citizens to drive foreign-plated vehicles into the US with temporary import permits, eliminating the need for US plates. Cao Yang (phonetic spelling), owner of Los Angeles import company CDM Import, says they are exploring ways to import Chinese cars and have helped temporarily bring some new Chinese cars to the US. These vehicles must leave within 12 months and cannot be resold. Furthermore, China imposes a six-month limit on private vehicle departures, requiring a substantial deposit from the owner. Considering shipping times, the vehicles effectively spend only about three months in the US, making them more suitable for short-term test drives by car enthusiasts rather than daily commutes. Cao Yang mentions that during this period, Chinese plates can be used with a temporary import permit attached. This also applies to Mexican citizens entering the US. Given the prevalence of Chinese EVs in Mexico, many border residents travel frequently between the countries, resulting in frequent sightings of BYD, MG, and Roewe EVs in Los Angeles, often driven by Mexican residents.

The most compliant method is for manufacturers to import vehicles for research and development testing. US law permits manufacturers to import foreign vehicles for R&D, road testing, and demonstration purposes. Cao Yang reveals that companies like BYD, Li Auto, and NIO can legally bring their vehicles in through their US branches, but these vehicles must carry manufacturer-specific plates and cannot be sold to individuals. However, companies may allow employees or even influencers to test drive them. Cao Yang mentioned that BYD's Pasadena design center has several Chinese models, and he has often seen employees driving these cars home. Ford CEO Jim Farley also stated that he had brought five Chinese EVs to Chicago last year and had been driving them, though a Ford spokesperson offered limited explanation.

Due to these restrictions, the cost of importing a car from China to the US far exceeds the original price. Weldon reveals that the benchmark shipping cost from Japan to the US is $105 to $130 per cubic meter, bringing the ocean freight for an average sedan to $1,000 to $2,500. Including customs brokerage, vehicle registration, and specialized insurance, the final cost often doubles. Karlin's Wuling Hongguang Mini EV cost approximately $13,000 in total, while the vehicle itself cost less than $8,000. Import costs are now even higher due to soaring tariffs. The Biden administration raised the tariff on Chinese EVs from 25% to 100%, alongside the Trump-era tariffs and recent 25% tariffs on all imported cars.

However, money may not be the biggest issue. In January 2023, the Biden administration implemented a ban on importing Chinese smart connected cars. With almost all new Chinese EVs equipped with Bluetooth, cellular, or satellite connectivity, this effectively blocks the import of all new models.

Despite the hurdles, Karlin still considers his Wuling Hongguang Mini EV a worthwhile purchase. Its innovative design is a stark contrast to his previous American cars, with thoughtful details like USB ports behind the rearview mirrors. Its compact size makes finding parking in busy hospital lots a breeze. After a year of ownership, an American company offered to buy his vehicle for research, with the CEO praising its details.

Cao Yang has also witnessed the enthusiasm for Chinese EVs. At California car enthusiast gatherings, temporarily imported Chinese EVs caused a sensation, with wealthy individuals inquiring about purchase options. "For those who are wealthy enough and have the connections," Cao Yang says, "they might consider importing a few to experience them firsthand." This all suggests that despite the challenges, the unique appeal of Chinese EVs continues to attract some US consumers.