EV

Parallel Imports vs Authorised Dealers: A Detailed Guide

Singapore’s electric vehicle (EV) market is experiencing remarkable growth, with electric vehicles now accounting for about one-third of all new car registrations from January to May 2024, nearly doubling from last year’s 18.1%.

Interestingly, this momentum has been building since last year, particularly among businesses, with about 1,041 commercial electric vehicles sold in just the first three months of 2023 alone.

This growth is spurred by an increased awareness of environmental sustainability and attractive government subsidies and incentives. As a result, EVs are becoming a more appealing and accessible option for those seeking to reduce their ecological footprint and improve their operational efficiency.

In light of this growth, those looking to join the shift towards a greener automotive future are presented with various purchasing options. These include acquiring an electric vehicle through an authorised dealer or opting for parallel importers in Singapore.

But what distinguishes these two routes? Let’s explore these differences to help you make well-informed decisions.

What is the Difference Between an Authorised Dealer and a Parallel Importer?

Switching your transport fleet to electric vehicles involves understanding the sourcing options available.

What is Parallel Import?

To start, let’s first clarify what is a parallel import.

Essentially, parallel imports refer to vehicles independently sourced by businesses from overseas markets and brought into Singapore, bypassing the official dealership channels. This approach allows them to operate outside the direct oversight of vehicle manufacturers, thus establishing an alternative market.

What is an Authorised Dealer?

On the other hand, an authorised dealer is a seller or retailer that electric vehicle manufacturers have officially appointed as their exclusive distributors. These dealerships hold formal agreements that authorise them to sell the manufacturer’s vehicles directly to the public while adhering strictly to the guidelines set by the manufacturer.

To gain a clearer understanding of their key differences, let’s explore the details below.

1. Vehicle Quality Assurance

Electric vehicles from authorised dealers are directly sourced from manufacturers, which guarantees adherence to stringent brand-specific quality and safety standards.

Conversely, parallel importers, while obtaining vehicles from diverse international markets, must also undergo rigorous local safety and compliance certifications before selling them.

Therefore, regardless of the sourcing method, authorised dealers and parallel importers ensure that all electric vehicles meet stringent safety and quality standards. However, the level of quality control processes employed by authorised dealers might differ from those of parallel importers.

Thus, businesses must judiciously select their sourcing as differences in quality control practices can profoundly affect their operational efficiency and reputation.

2. Specifications and Customisation

Generally, vehicles are configured to suit the specific requirements of the regions where they are sold. Authorised dealers offer vehicles designed to meet these local standards with a fixed set of features.

Alternatively, parallel importers provide vehicles that may include unique or additional features not typically available in standard models within the region. This gives consumers more customisation options, allowing for a more tailored electric vehicle choice.

3. Parts and Repair/Maintenance Services

Electric vehicles purchased through authorised dealers guarantee consumers access to Original Equipment Manufacturer (OEM) parts, as they directly source from manufacturers. Additionally, their staff receive proper training and certifications from the manufacturer, enabling them to handle repairs and services according to the manufacturer’s standards.

In contrast, electric vehicles from parallel importers may depend on independent service providers, who may not always have access to genuine parts or specialised training, leading to potential inconsistencies in service quality. This could affect business operations by increasing downtime and maintenance costs.

4. Warranty and After-sales Support

For commercial businesses that depend on their fleet of electric vehicles, warranty coverage is a critical factor in the purchasing decision. Choosing an authorised dealer means access to comprehensive, manufacturer-backed warranties, which are crucial for ensuring reliable and prompt service. This is especially important for commercial vehicles, where operational efficiency and minimal downtime are vital.

On the other hand, warranties offered by parallel importers can vary widely, often relying on third-party workshops for servicing. This variability in warranty terms and coverage can lead to uneven after-sales support. As a result, businesses may face challenges in maintaining consistent service quality and reliability, which are essential for sustained operations and customer satisfaction.

5. Financial Considerations

When purchasing an electric vehicle, price usually plays a pivotal role in the decision-making process. Typically, authorised dealers offer vehicles at higher upfront costs, but these prices include comprehensive warranties and reliable after-sales support, which can significantly lower overall expenses throughout the vehicle’s lifecycle. This predictable financial planning is critical for businesses managing budgets and forecasting long-term expenses.

Conversely, parallel importers often present lower initial pricing due to their ability to bypass traditional dealership networks and source vehicles directly from various markets. This cost-saving approach can make their offerings more financially accessible at the outset.

While this can be an appealing option, buyers should consider the warranty and service quality variations. These discrepancies can cause unpredictable financial impacts, affecting long-term budgeting and operational stability.

Making an Informed Decision

With these key differences distinguishing parallel import from authorised dealers, many consumers tend to come to a crossroads—should they opt for a parallel importer or rely on an authorised dealer?

If initial cost savings and the flexibility for customisation are your top priorities, choosing a parallel importer might be the appealing option due to their lower upfront prices and varied options. This route is particularly suitable for those with tight budgets or businesses requiring specific configurations.

However, if long-term reliability, comprehensive after-sales service, and robust warranties are more vital, then opting for an authorised dealer would be a wise choice.

The decision isn’t merely financial but strategic, requiring businesses to weigh their immediate budgetary limits against the need for sustained performance and support. This choice will shape their operational landscape, impacting their agility and resilience in a competitive market.

Driving Towards Sustainable Solutions

As Singapore advances its Green Plan 2030, aiming to revolutionise transportation with eco-friendly solutions, the market is witnessing an expansion of both parallel importers and authorised distributors to meet the increasing demand for electric vehicles. This expansion is particularly beneficial for businesses looking to enhance their national environmental goals, corporate sustainability practices, and benefit from government subsidies and incentives.

When considering an authorised distributor for your business’s transport fleet, Hong Seh Evolution proves to be a reliable and trusted choice. As a leading authorised distributor in Singapore, we offer a diverse range of high-performance commercial electric vehicles, including electric trucks and electric vans, ensuring optimal performance, support, and sustainability for your business’s transportation operations. Contact us now for more information.