What Are the Risks of Buying a Japanese Import Car?

In recent decades, imported Japanese cars have become increasingly popular in the United States. Their reputation for reliability and fuel efficiency, combined with some unique and advanced models unavailable domestically, draw many American buyers to the used import market each year.

However, purchasing directly from Japan presents some unique risks that buyers must consider carefully. This article will explore the potential downsides of buying an import and provide tips to help navigate those risks.

Popular Japanese Autos

The popularity of these automobiles in America stems mainly from their excellent reliability and durability track records. Well-known manufacturers like Toyota, Honda, Nissan, and Subaru consistently rank at the top in surveys measuring new vehicles' dependability and longevity. Their fuel-efficient models also appeal to environmentally-conscious buyers and those wanting to save money at the pump.

Additionally, specific models that aren't sold new in the US but can be imported, opening up more options for collectors and fans of niche brands.

While Japanese cars tend to perform well mechanically, importing one does present some risks that buyers must be aware of.

Reliability Concerns

Most surveys show that Japanese brands, on average, are among the most reliable automobiles on the road. However, buyers should recognize that not every imported one will live up to its reputation.

Age and service history are critical factors. Automobiles 15-20 years old and with unknown maintenance histories from private owners carry more risk than a new auto from a domestic dealer lot.

It's essential to avoid the assumption that all imports, simply by being Japanese, will not have mechanical problems. Thorough pre-purchase inspections by a trusted mechanic are necessary to evaluate the condition of high-mileage used vehicles.

Issues like corrosion from road salt or neglect could negate any reliability advantage. Even reliable brands can develop expensive problems if neglected for many years. Overall, condition reports from resources like Carfax can offer insight, but only a physical exam by an expert can catch all potential trouble spots.

Costs

Compared to domestic cars, imports tend to have lower initial purchase prices since used one values depreciate faster there.

However, additional expenses are involved in importing one legally. Buying directly from an individual requires the services of an importing broker, which adds brokerage fees of around $1,000 on average. There are costs, import duties of about 2.5% of the value, and any fees to deliver it domestically.

Taxes also tend to be higher long-term. Due to their perceived lower value, many states assess extra taxes over a certain age, like 10-15.

Additionally, older imports are subject to the federal Gas Guzzler Tax if they don't meet current fuel economy standards. Insurance and registration fees may also be elevated for higher-risk imported models.

All these ongoing costs must be weighed against any initial savings from a lower purchase price. Even if slightly more expensive, a domestic equivalent could prove cheaper to own in the long run.

Maintenance Challenges

Sourcing the proper parts and manuals and finding qualified technicians to service less common nameplates can present difficulties, especially for models never officially sold in the US market.

While popular models like Toyota and Honda have extensive parts distributions and certified mechanics nationwide, more obscure brands may require particular ordering of components and extensive searching to locate a knowledgeable independent shop.

Language barriers and lack of localized technical resources are other issues. Service manuals, troubleshooting guides, and online forums geared toward American owners of mainstream European autos generally don't exist for all rare models.

Joining owner clubs online becomes very important to crowdsource solutions, locate parts suppliers, and recommend trusted maintenance facilities. Do-it-yourselfers may find repairs more complex without their native language documentation and support networks readily accessible.

Resale Value Considerations

Generally, previous import status weakens a used autos resale value versus an identical domestic model. The limited pool of buyers willing to inherit any added responsibilities reduces market demand.

Moreover, if an imported brand has low sales volumes stateside, the specialized knowledge and enthusiasm required by buyers of that particular model become a significant resale barrier.

Comprehensive paperwork becomes even more crucial to recoup value. Prospective buyers want clear and complete service records to verify the history of low-production imports approaching higher mileage.

A pristine condition report and verifiable maintenance timeline mitigate uncertainty and reassure that major component replacements or repairs have been addressed over the years.

Warranty Issues

New auto warranties provided by manufacturers do not transfer across international borders. Most vehicles imported privately will have no factory coverage remaining on mechanical components and electrical systems. This leaves the new owner fully responsible for any defects from the get-go.

Third-party extended warranty providers can cover older imported motorcars, but policies come with exclusions and higher deductibles and do not reimburse average maintenance costs.

It pays to scrutinize the small print of these aftermarket contracts for vagueness that could allow claims denials. Drivetrain warranties are unlikely for vehicles over ten years old as risk levels increase exponentially with age and mileage.

New owners must fully accept substantial repair liabilities immediately instead of benefits like the reassurance of a new automobile limited warranty during break-in periods. Budgeting for the increased likelihood of unexpected mid-term repairs makes a higher initial purchase price potentially more sensible to retain factory coverage.

Compliance with Customs and EPA Regulations

The process of legally importing to the United States is complex, with many hoops. Federal regulations strictly prohibit registering any vehicle that does not comply with all applicable Environmental Protection Agency (EPA) emissions and Department of Transportation (DOT) safety standards.

When working through an experienced importer, they handle the detailed applications and record work necessary to receive an EPA certification of conformity for the specific model being brought into the country.

This certification and accompanying compliance adjustments, like the replacement of noncompliant parts, can take several months to obtain once the car is located for purchase there.

Additionally, a 25-year rule exists where automobiles under 25 years old at the time of import require modifications to meet either EPA or National Highway Traffic Safety Administration (NHTSA) regulations regarding safety and emissions. Noncompliant ones cannot legally be registered, plated, insured, or driven on public roads, exposing owners to penalties if they circumvent regulations.

Potential for Fraud and Misrepresentation

Risks of deception exist when dealing with private sellers across international borders versus domestic dealer establishments. Doctored documents, illegal odometer rollbacks, and concealment of past damage incidents are possibilities. Language barriers interfere with fact-checking health representations and achieving full disclosure.

New owners bear sole responsibility for adequately vetting a prospective purchase overseas through diligent due diligence like comprehensive history reports, requesting supporting maintenance records in English from the seller if possible and potentially hiring an inspector to examine it in person on their behalf, depending on unique circumstances.

Reputable importers should always be favored over unknown individuals due to qualifications in handling complex import logistics and consumer protections and warranties against future title or condition issues coming to light.

Wrapping Up

In conclusion, while imports hold appeal from a mechanical reliability perspective along with access to one-off models, purchasers must fully acknowledge certain drawbacks and risks involved versus choosing domestic alternatives.

Higher upfront costs, difficulties sourcing qualified assistance further down the line, insurance complexities, potential future compliance issues, lessened resale values, and lack of factory protection plans necessitate realistically weighing benefits against downsides.

An abundance of caution, doing comprehensive research on a given nameplate's issues, and seeking guidance from expert importers aids in circumventing potential problems. Joining online communities of other owners provides maintenance and repair advice.

Ultimately, those accepting greater responsibilities see the rewards of exclusivity. But buyers must go into the process with eyes wide open about inherent unknowns compared to purchasing locally. After understanding their responsibilities, enthusiasts can be confident in their choice to buy Japanese.

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