HS Code:
The category 'To be used in motor vehicles having a G.V.W. not exceeding 4 metric tons' generally includes parts, components, or accessories specifically designed for use in light motor vehicles with a gross vehicle weight (G.V.W.) of up to 4 metric tons. This category typically falls under various subheadings of the Harmonized System (HS) Code Chapter 87 (Vehicles other than railway or tramway rolling stock, and parts and accessories thereof). These products are essential for the automotive industry, covering a wide range of items such as engines, chassis, body parts, and other components tailored for smaller commercial vehicles, vans, and passenger cars.
Total Trade Volume
Approximately $45 billion USD
Data from 2022
Source
United Nations Comtrade Database, International Trade Centre (ITC)
$8.5 billion USD
18.9% of total trade of total trade
Increasing
$6.2 billion USD
13.8% of total trade of total trade
Stable
$5.8 billion USD
12.9% of total trade of total trade
Increasing
$4.9 billion USD
10.9% of total trade of total trade
Increasing
$3.1 billion USD
6.9% of total trade of total trade
Stable
Average Rate
4.5% ad valorem
Highest Rate
25% (imposed by certain developing countries on automotive parts)
Lowest Rate
0% (under free trade agreements such as USMCA and EU-Japan EPA)
Shift towards electric vehicle components
Increased demand for EV-specific parts (e.g., batteries, electric motors) for light vehicles, reducing demand for traditional internal combustion engine parts
2021-2023
Supply chain diversification
Manufacturers are sourcing components from multiple regions to mitigate risks from geopolitical tensions and pandemics, boosting trade in countries like Vietnam and India
2020-2022
Rising production costs due to raw material shortages
Higher costs for steel and semiconductors have led to price increases, affecting trade volumes and profit margins for exporters
2022
The United States-Mexico-Canada Agreement (USMCA) introduced stricter rules of origin for automotive parts, requiring a higher percentage of regional content to qualify for duty-free treatment.
July 2020 (ongoing enforcement through 2023)
Increased production costs for non-compliant manufacturers, but boosted intra-regional trade among the US, Canada, and Mexico.
The European Union's Green Deal policies are pushing for stricter emission standards and incentives for electric vehicle adoption, influencing the types of parts in demand.
December 2022
Shift in trade patterns favoring EV component exporters while traditional parts face declining demand in the EU market.
China has ramped up production and export of cost-competitive automotive parts for light vehicles, capturing significant market share in Asia and Africa.
Mid-2022 to 2023
Increased competition for traditional exporters like Germany and Japan, leading to price wars in certain markets.