Presentations at NAATA meeting – Sept 27 & 28, Vancouver, British Columbia
Registrar of Imported Vehicles, Gary Moriarty
The Registrar of Imported Vehicles (RIV) program was established under the Motor Vehicle Safety Act. The RIV inspects imported vehicles built to American safety standards and certifies that they have been modified to comply with Canadian standards.
RIV maintains vehicles import documents and records on behalf of Transport Canada. RIV has no authority to set federal compliance regulations, compel manufacturers to produce compliance information, determine manufacturer recall or warranty policies or administer fines and penalties.
RIV recognizes the needs to introduce new technologies to adopt to the changing nature of the import community. RIV is looking at on-line inspection processing, on-line case management, migration to e-documentation where possible and real time communications with U.S. and Canadian jurisdictions.
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Blake, Cassels & Graydon, Wei Shao
Exporting vehicles to China is quite different than selling in North America or in Europe. In those places, auto dealers are more accustomed to cold calls and aggressive selling practices. People are more focused on business.
To sell into China, North American exporters must first become aware of the concept of “Guanxi”. Guanxi loosely translates to “connections” or “relationships”. It is first necessary to establish Guanxi to export to China. You must have a personal connection to the person you are selling to.
These connections and relationships can be cultivated and developed. Introductions from advisors, consultants, trade associations, colleagues and friends are important. These people have a role to play in fostering Guanxi. Often, people who try to export to China give up when they do not meet with immediate success. It is important not to give up and instead work to develop Guanxi.
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Canada China Business Council, Gordon Chu
China is a large and growing market. Consumerism is quickly developing in China, where there is generally a focus on value for money.
China’s coastal market is the location of most of the country’s wealth. There is active consumerism and thriving auto markets in the belt spreading between Guangzhou, Shenzhen, Shanghai and Beijing.
The interior market may be an interesting and viable market for North American vehicle exporters. There are people who live in these areas who have great wealth who can afford vehicles imported from North America. These areas are underserviced by existing vehicle dealers.
It is important to cultivate contacts at all levels to import vehicles. It is also important to maintain control over all business dealings and to not simply leave critical matters (e.g. financial controls) to partners in China.
The Chinese have a different negotiating style. The Chinese use social events to get to know people and to gather information and assess character. Direct negative replies can seem abrupt and rude. Such comments can damage business relationships. Avoid humor and loss of temper. Patience is a virtue in selling to China and will be rewarded.
The Canada China Business Council can help to develop business relationships with people who can help North American exporters break into the Chinese market.
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KPMG, Charles Li
The Ministry of Commerce issues import licenses. Obtaining licenses requires contacts in government and industry. It is valuable to develop these contacts. Show a genuine interest in meeting them. Introductions to people you want to meet are helpful. Chinese auto dealers do not generally respond to direct solicitations in the same way that American dealers respond.
The coastal areas are where most luxury vehicles in China are located. Shanghai, Beijing and Guangdong province are good markets for vehicles exported from China.
KPMG has a dedicated team for the Chinese market in Canada and the United States and also has offices in several cities within China. They can help North American exporters develop relationships and navigate licensing and regulatory issues in auto sales to China.
Travelex International Foreign Exchange, Anil Sawrup and Ian Goodwin
Exchange rates move up and down. Generally, markets are efficient. All information regarding the future movement of exchange rates, particularly the Canadian and American dollars, are immediately taken into account in exchange rate values.
This means that it is effectively impossible to predict what will happen to exchange rates. It is certain they will move, but no one really knows in which direction. Economists make predictions, but those predictions are wrong as often as they are right.
The auto import and export business is highly vulnerable to exchange rate movements. Profits and losses are dependent on these movements.
It is possible for vehicle importers and exporters to protect themselves against exchange rate fluctuations. They can lock in rates, ensure that they can trade money within a certain range and can better plan ahead with this certainty.
Some products used to fix exchange rates can be expensive. Other products have minimal or no cost. It is very worthwhile for vehicles exporters and importers to take a look at these products to determine if they can keep vehicle export profitable. Payments can also be structured to give exporters faster access to their money.
