China Tightens Regulations on 'Zero Mileage' Car Exports

China cracks down on 'zero mileage' vehicle exports to prevent automakers from inflating sales and claiming undue tax rebates. New regulations require after-sales service guarantees and aim to protect brand image. These changes address document falsifications and apply to cars exported within 180 days of registration.

China has introduced stricter rules on the export of "zero mileage" vehicles, a strategy that has enabled some automakers to report inflated sales figures and receive unintended tax benefits. The new regulations, which come into effect on January 1, require automakers to offer concrete after-sales service guarantees for their exports.

The constraints are designed for cars shipped abroad within 180 days of registration and aim to correct distorted sales data, a method previously used to make it appear that overstocked inventories were being sold at higher rates. This move occurs as Chinese automakers face intense competition within their domestic market.

The Chinese Ministry of Commerce has reported that these regulations will also address falsifications in registration and export paperwork for those shipments. This initiative is expected to improve the brand image of Chinese vehicles overseas amid growing concerns over the lack of after-sales support for such exports.

(With inputs from agencies.)