Grey imports thrive in the UAE’s motoring marketplace

We look at the popular world of imported cars being sold in the UAE and offer advice on buying one for yourself.

Al Awir used-car complex, in Dubai’s Ras Al Khor industrial area, is home to more than 130 dealerships. Antonie Robertson / The National

Gautam Sharma

Importing cars can be a bit of a grey area in the UAE, ­literally. “Grey” imports, as they’re ­referred to, are cars that have found their way to our market via channels other than regional distributors.

There’s a thriving business for imports of this type – sourced mainly from the United States, Japan and Europe – and one of the major reasons why these vehicles end up here is cost. New vehicles are cheaper in the United States than they are here, and this is reflected in their ­second-hand values. This makes it lucrative to import them here, even after the shipping costs and local import duties in the UAE have been factored in.

The case is slightly different with imports from Japan, as new cars are generally pricey in the Land of the Rising Sun, but they attract a significantly higher annual road tax as they get older, prompting owners to offload them and purchase a new one. A huge percentage of these unwanted vehicles end up being exported at almost throwaway prices, and many of them find their way to our shores.

The other incentive for sourcing a grey import is that it gives you access to makes and models of cars that were never offered here as new vehicles. Examples of these may include the hulking Toyota Tundra pick-up, Ford's Mustang Boss 302, the Pontiac Solstice. There's also a flourishing trade in older classics, such as Chevy Camaros and Corvettes, Pontiac Firebirds and Ford Mustangs from the 1960s and 70s. As it turns out, The National's former motoring editor Kevin Hackett is himself making noises about wanting to get his mitts on a ­Triumph TR6 (built and sold from 1968 to 1976). As a two-time former Triumph owner myself, I can see why he's leaning that way, but that's a subject for another column.

There are two basic paths you can take if you’re eyeing a grey import – one is to take care of the whole process yourself, which entails sourcing the vehicle you want from the country where it’s located, organising shipping and fulfilling the customs procedures and paying import duties once it lands here. The final step is to take it to the RTA to get it inspected, registered and fitted with local number plates. Another solution is to go somewhere like Al Awir Used Car Complex, in the Ras Al Khor Industrial Area, Dubai. It’s a haven for dealers who specialise primarily in sourcing and selling grey imports. They take care of all the legwork and paperwork for you, but more on this later.

I’ve alluded to the benefits of buying a grey import, but there are also several potential pitfalls for the unwary, particularly as the history and status of the vehicle you’re interested in can be a bit murky. This is a sufficient deterrent for some, including Bob Farrow, the director of auto consulting firm BFM Management Consulting.

“I would never touch one [a grey import],” he says. “In theory there are websites [such as ­Carfax, for cars sourced from US] where you can check the history of these vehicles, but flood and hail damage often aren’t declared. I know of one case here where a car’s dashboard had to be stripped down to fix a fault with the wiring loom, and the technician then discovered a pronounced watermark behind the dashboard, showing the vehicle had been submerged at some point in its life. Another potential concern with grey ­imports is that they don’t have GCC-spec engine cooling and air-conditioning systems, so they may not be up to the extreme heat we face here.”

Farrow also alludes to the fact that a privately imported vehicle’s factory warranty (if it’s new enough to still be covered by one) may not be honoured by the relevant dealership here, even though all warranties are theoretically supposed to be global. Another potential problem is that some grey imports sold here started life as right-hand-drive vehicles before being converted to left-hand drive for our market. “The problem here is that many of these will have had their wiring looms, steering systems and pedal boxes put together by a little guy with pliers. That would be enough to put me off.”

Other factors to be wary of include speedometers that are calibrated in miles per hour (rather than kilometres per hour), which could lead to expensive speeding fines if you’re oblivious to this fact. Many grey imports don’t come with service records, and you can never be too sure whether the odometer has been tampered with to show a lower reading than is actually the case.

“Unless the car is something with real novelty value, such as a Jaguar E-Type, I don’t think buying a grey import is worth the small amount of money you save. I certainly wouldn’t be buying a grey-import Corolla,” ­Farrow concludes.

There are always two sides to every story, and John Samuel of Al Awir-based Mercury ­Global Motors says there’s nothing to worry about when buying a grey import, provided you carry out the requisite due diligence.

“I would recommend getting any car you’re interested in subjected to a bumper-to-bumper check by Tasjeel or a competent garage for about Dh300 to Dh400,” Samuel says. “The main thing is that the chassis should not be damaged or have been tampered with in the past. Tasjeel carries out a visual scan of the chassis, and if in doubt they refer it for testing on a ­chassis-screening machine that detects any flaws.”

For vehicles sourced from the US, Samuel also recommends paying a nominal fee and plugging the car’s Vin (Vehicle Identification Number or chassis number) into online resources such as Carfax or National ­Motor Vehicle Title Information System (NMVTIS) to ascertain its history. These sites provide information on the vehicle’s title, most recent odometer reading, service/accident ­history and, in some cases, historical theft data.

After Hurricane Katrina, US authorities reported lorryloads of flooded vehicles being taken out of Louisiana to other states as far away as the upper Midwest, where they were dried out, cleaned and readied for sale to unsuspecting consumers in states that don’t brand flood vehicles. Prospective purchasers of these vehicles may not have known that the vehicles had been subjected to a saltwater flood that made the vehicles’ electrical systems (including their airbag sensors) more prone to failure.

One of the aims of NMVTIS is to prevent vehicle histories such as these from being “washed” or concealed – it’s designed to serve as a national repository of vehicle brand information. However, the system doesn’t yet cover all states in the US, so you shouldn’t treat it as a panacea.

Most grey imports on offer here aren’t covered by a manufacturer warranty, but Samuel says companies such as Gulf Warranties can provide peace of mind via an aftermarket warranty. The price you pay for this will depend on the age, condition and type of vehicle. Samuel says many of the cars his dealership sells are covered by such a warranty, with the cost built into the selling price of the vehicle.

Samuel says his dealership specialises in cars less than three years old, with the majority of these being BMW X5s and X6s, Range Rovers, various Mercedes-Benz models, Toyota Tundras, Ford F-150s and so on. “If you’re looking at a used Range ­Rover that would otherwise have cost you around Dh280,000 to Dh290,000, we can sell it to you for around Dh200,000, so it’s good for budget-conscious ­buyers,” ­Samuel says.

Describing the process through which this dealership sources cars, Samuel explains: “My contact in the US finds good cars for me and then organises shipping. They are then put in a shipping container and arrive here after 30 to 35 days. Once they’ve landed here, I pay a 5 per cent excise on the value of each car, which is based on the price on the invoice. The next step is to take the cars and customs documents to Tasjeel, where I pay Dh200 for each car to be inspected. Once each car has passed the vehicle inspection, they are ready to be registered and fitted with local number plates.”

Although Samuel advocates buying a grey import for the cost savings you can reap, he warns that this can have a knock-on ­effect when the time comes for you to sell it, as it will likely be worth less than a similar age GCC-spec vehicle. He also points out that cars sourced from colder climates may be equipped with features such as heated seats and winter tyres, which are obviously useless here.

You can get a good idea of the types of grey imports on offer and the prices asked for them by taking a stroll through Al Awir Used Car Complex. Here, you’ll find more than 130 dealerships specialising in cars that range from mainstream to offbeat collectables that are as rare as hen’s teeth. It’s a veritable one-stop shop, as there are also car-loan providers, auto-insurance companies, vehicle-testing and inspection services, the Police Traffic Department and a Tasjeel facility for car registrations.

There’s ample scope for bargaining, but one of the tricks here is to not appear overly keen on a vehicle (even if you are). And don’t sweat it in case the particular make and model of vehicle you’re seeking isn’t to be found on the premises, as most dealers will be happy to source one for you if you provide them with the model specifics.

I once came close to buying a grey import myself. It was an immaculate 1991 Porsche 944 S2 advertised on ­Dubizzle. Imported from Japan, it had been fastidiously maintained, so much so that it looked as though it had just rolled out of the showroom, even though it had around 90,000 kilometres on the clock. It drove well, too, but I regretfully passed on it as I needed a daily driver, not something that I’d want to shield from shopping mall car parks and day-to-day wear-and-tear.

I personally would have no reservations about buying a grey import, but I’d make darn sure of thoroughly doing my homework on the car in question first. You should do the same if you plan on venturing down this path.