Uzbekistan has adopted a regulation increasing the recycling fee for electric vehicle private importers and unauthorized dealerships. The new policy will be effective May 1. However, local manufacturers, such as the BYD Uzbekistan Factory, are exempt from this fee for the next five years. This resolution may lead to higher prices for Chinese electric cars imported by private companies.
Who will be affected by the new recycling fee?
On Jan. 31, 2025, the Uzbek government approved a recycling fee increase for imported EVs without prior discussions. The amendment primarily affects private importers, who supply affordable cars from China. Local media estimate that the fee for cars under three years old will quadruple, reaching 45 million Uzbekistani som (around $3,500).
That being said, several local carmakers have been entirely exempt from the recycling fee until 2030. Their vehicles are priced 15% to 20% higher than those sold by private importers.
Notably, the recycling fee does not apply to plug-in hybrid electric vehicles (PHEV), giving an upper hand to local factories like ADM Jizzakh.
How will the market react?
According to Uzbek lawmakers, the fee has been increased to promote ecological safety and fund battery recycling. On the other hand, critics of the initiative claim that, by doing so, authorities aim to strengthen the positions of major domestic manufacturers. The new regulation may lead to a significant price increase for imported electric vehicles. Moreover, experts believe that these measures will hinder private entrepreneurs’ access to the market and negatively affect the overall competition.
Uzbekistan’s accession to the World Trade Organization will also not resolve the issue. New non-tariff barriers provide local car manufacturers with a competitive advantage, reducing their costs compared to importers.
In Kazakhstan, the recycling fee has been in effect since 2016 and applies to cars and agricultural machinery.
Kazakhstan previously imposed a 30% customs duty on imported cars. The government states that the duty is intended to limit car imports, while the recycling fee is meant to curb the imports of old passenger cars.
Last summer, Kazakhstan’s Ministry of Industry rejected a petition calling for the cancellation of the recycling fee and the initial vehicle registration fee.
