Buying a car in Dubai

Buying a car in the United Arab Emirates or importing one from there is perfectly legal, and could even be a way to get a good deal. The whole process is longer and a bit more complex than a regular car purchase, so I'll walk you through it in detail in this guide. Whether you are an expatriate living in Dubai and wanting to buy a car, or you just want to import a car from Dubai to the U.S., you will know everything there is to know about buying a car in Dubai by reading this article!

THE ADVANTAGES OF BUYING A CAR IN DUBAI

Today, Dubai has become a symbol of wealth and exuberance, with many dealerships offering luxury vehicles. In contrast to the prices in the U.S., the prices of the vehicles offered by these dealerships are often lower, largely due to the low VAT rate. For a long time, no tax was applied. Nowadays, a tax is applied, but it is of only 5%.

In Dubai, it is therefore possible to find dealerships offering vehicles of the most famous brands (Ferrari, Porsche, Audi, Rolls Royce, McLaren, Lamborghini, ...), new or second-hand, at a lower price than they would be on the American market.

An expatriate will therefore have no trouble making a good deal, and this purchase will remain interesting even taking into account the taxes and costs associated with an import.

Depending on the duration of the expatriation (short, medium or long term), renting a car in Dubai could also be a good alternative.

HOW TO BUY A CAR IN DUBAI?

For an expatriate living in Dubai, only two criteria are necessary to purchase a vehicle:

• Having a Resident Visa
• Having a Dubai driver's license

For an American license to be valid in Dubai, it must be converted into a Dubai driver's license. To do this, the licensee will have to pass an eyesight test and pay a fee.

Searching for a vehicle is done as you would in the U.S., by searching on the Internet, comparing prices (which will mostly be in dollars or dirham) or by going directly to a car dealer in Dubai. Several car sales sites in Dubai are very reputable, such as Dubai Cars, Auto Trader UAE and Dubizzle.

After purchasing a vehicle, it must be registered and insured in order to be used on the roads of the United Arab Emirates.

WHAT ARE THE FORMALITIES TO IMPORT A CAR FROM DUBAI?

As an expatriate wanting to bring back a car bought in Dubai, or if you simply want to import a vehicle from the emirate, you will have to respect certain conditions.

Whether on the Dubai side or on the American side, the regulations are quite strict, and you will be fined if you do not respect them to the letter. You will also need a great deal of patience and understanding of the processes.

ELIGIBILITY OF VEHICLE

If you wish to import your vehicle into the U.S., the very first step is to make sure that you can. Indeed, your vehicle must meet the regulations set up by the importing authority. For the U.S., there are mandatory safety and emission standards, and if your car does not meet them, you won’t be allowed to import it from the UAE. You can check these regulations here, or by contacting the U.S. Environmental Protection Agency (EPA). Note that if your vehicle does not meet these regulations, it will not pass Customs and will be either sent back to the UAE or destroyed.

Tip: vehicles 25 years old or older do not have to comply with the DOT’s regulations. Therefore, even if your vehicle does not meet the standard, you will not have to pay for it to be modified accordingly. That’s always good to know if you haven’t bought your vehicle yet, but wish to bring it back with you to the U.S once purchased….

In addition, be aware that your vehicle’s manufacturer must have affixed a conformity sticker onto your vehicle, guaranteeing that all standards have been met. Should your vehicle not have this sticker, you will have to pay 1.5 times the vehicle’s duty value – and that’s on top of the Customs entry bond that is to be paid at the time of import. 

Finally, you will need to explain your reason for importing your vehicle in the country… 

All these rules are strict and must be respected. Additionally, receiving confirmation of your vehicle’s eligibility can take quite some time: it is really recommended to wait for this confirmation before contacting any shipping company.

PREPARE YOUR DOCUMENTATION:

Paperwork is very much part of the importation of your vehicle into the U.S. from the UAE. To successfully import your car, you will need the following documents:

• Your bill of lading (a legal document issued by a carrier to a shipper, detailing the type, quantity and destination of the good(s) being carried. It can also serve as a shipment receipt);
• Your vehicle’s bill of sale;
• Your vehicle’s registration from the country of origin;
• Proof of ownership;
• EPA Form 3520-1 showing emissions compliance;
• DOT Form HS-7 showing safety compliance;
• The manufacturer’s conformity sticker (in English)

Preparing all these documents beforehand will help you import your vehicle on time, without having to rush or being held back by the procedures.

Customs duty

All motor vehicles imported into the U.S. are subjected to customs duty, controlled by the Customs and Borders’ Protection (CBP). The rates are generally as follows:

• 2.5% of the vehicle’s price for automobiles,
• 25% for large trucks,
• No customs fees, or up to 2.4% for motorcycles.

In addition to this import tax, you will have to pay a Gas Guzzler Fee if your vehicle has an average combined Miles Per Gallon (MGP) of less than 22.5. This fee does not apply to trucks, minivans or SUVs, and is applied separately for each vehicle you wish to import.

Note that, if you are an U.S. resident returning to the United States with your car, you may be eligible for customs fees exemption, if you are either: 

• Returning from travel abroad,
• Returning from studying abroad,
• Or returning from working abroad.

You can even receive a credit of up to $800 for customs fees, if your vehicles meets the following conditions:

• It is imported for personal use only;
• You are coming back with it (at or around the same time);
• It was purchased from the country you are returning from.

You can learn more about all these conditions and criteria on the CBP official website, of course – it is always good to know about them 🙂

IMPORTATION OF THE VEHICLE

Of course, transportation fees cannot be forgotten. You will have to use a shipping company, and taking into account the sea freight, the sea insurance and the port fees, the total amount will generally be between $3,600 and $4,400.

There are also companies that offer air transport of vehicles. These transports are much faster, but they are also much more expensive. Air shipments are at least 4 times more expensive than sea shipments, and the journey is often more chaotic. Some companies specialize in transporting luxury vehicles, but their services are even more expensive, and a transport between Dubai and the U.S. by air will cost you several tens of thousands of dollars.

In any case, I recommend buying an Export Insurance Certificate. It acts as an insurance for your vehicle during its importation, and can be purchased for approximately AED 70. To do so, you only have to contact one of the offices of the Road Transport Authority in Dubai. Careful though: this certificate is only valid for 2 weeks. Make sure to buy it once your vehicle is set to go!

DEREGISTRATION OF YOUR VEHICLE

To import your vehicle into the U.S. from the UAE, it is mandatory to deregister it beforehand. To do so, you must present yourself at the transport authority offices with the following documents:

• Your vehicle registration card,
• Your Export Insurance Certificate,
• You driving license,
• Your current number plate.

You will also have to pay a fee. Once this step is done, you will receive an export certificate: it is the authorization for the importation of your car into the U.S. You will then need to show this certificate to the export officer, who will then give you a blue license plate showing that your car is ready for export. 

Remember not to leave anything in your car during its importation. Shipping companies consider some things as liability: if you really want to keep some things in your car, check with your shipping company beforehand, to know what is allowed and what isn’t. Additionally, note that some shipping companies will empty your gas tank as well as disconnect your car’s battery to be on the safe side. Don’t gas up just before shipping your car!

We are coming to the end of this post on buying a car in Dubai and importing it in the U.S.. I hope the information has been useful to you, and in any case, much luck and patience to you!! 🥲

In the same vein, if you are looking for information on how to work in Dubai or live in Dubai, feel free to check out my articles on the subject! Don’t worry, the procedures are much simpler… 😅