China's "Zero-Kilometer" Used Car Ban Reshapes Export Industry in 2026
Starting January 1, 2026, China requires manufacturer-issued after-sales confirmation for vehicles exported within 180 days of registration. The policy effectively bans "zero-kilometer" used car exports, which accounted for over 90% of NEV exports in 2024. An estimated half of 3,000 export firms may exit the market.
Background: The Rise of Zero-Kilometer Exports
Since China launched its used car export pilot program in 2019, the industry has experienced explosive growth — from just 3,000 units in 2019 to an estimated 500,000–600,000 units in 2025. However, a significant portion of these exports were not genuine "used" cars at all.
According to the China Automobile Dealers Association, vehicles registered for ≤3 months with ≤50 km mileage accounted for 12.7% of the domestic used car market in 2024. For new energy vehicles (NEVs), the proportion was even higher — over 90% of exported "used" NEVs were effectively brand-new cars registered solely for export purposes.
This practice emerged because manufacturers restrict direct new-car exports through dealer agreements, creating an arbitrage opportunity: register the car domestically, then immediately export it as "used."
The November 2025 Joint Notice
On November 11, 2025, four Chinese ministries — the Ministry of Commerce (MOFCOM), Ministry of Industry and Information Technology, Ministry of Public Security, and General Administration of Customs — jointly issued Document No. 商贸函〔2025〕648号, with key provisions effective January 1, 2026.
Key Requirement: After-Sales Service Confirmation
For any vehicle being exported within 180 days of its registration date, exporters must now submit an After-Sales Service Confirmation Letter (《售后维修服务确认书》) issued and stamped by the vehicle manufacturer. The document must include:
- Destination country
- Vehicle information (VIN, model, specifications)
- After-sales service network details in the destination market
Vehicles that cannot provide this documentation will be denied export licenses.
Additional Measures
- Stricter license matching: Export license applications must exactly match the Motor Vehicle Registration Certificate — including brand, model, registration date, and transfer date.
- Credit evaluation system: A negative list of dishonest behaviors has been established, with repeated violators facing license revocation.
- Modified vehicle scrutiny: Modified vehicles must prove modification authenticity and hold valid CCC certification.
Industry Impact
The impact has been immediate and dramatic:
- 2025 saw a rush to export: An estimated ~1 million zero-kilometer vehicles were exported in 2025 as dealers raced to clear inventory before the deadline.
- Mass consolidation expected: Industry analysts estimate that half of China's ~3,000 used car export firms may exit the market in 2026.
- Margin compression: Average gross margins fell from 25–30% (2021–2023) to just 5–10% by end of 2025.
- Shift to genuine used cars: Surviving traders are pivoting to real-mileage vehicles, where margins are a healthier 15–20%.
Long-Term Outlook
2026 is widely described as a "watershed year." The policy forces the industry to transition from speculation-driven growth to quality-driven, service-intensive competition. The winners will be companies that build genuine overseas service networks, secure manufacturer partnerships, and develop real value-added capabilities.
Source: MOFCOM Document 商贸函〔2025〕648号, November 2025
