Shipping · · Updated · 5 min read
FOB vs CIF for Vehicle Shipping: Which Should Car Importers Choose?
By the EVtoU export team
Choose FOB if you already have a freight forwarder and want to control the ocean freight; choose CIF if you want the exporter to book shipping and insurance to your port. Both are Incoterms® 2020 rules published by the International Chamber of Commerce, and both are designed for sea transport.
What does FOB include?
Under FOB (Free On Board), the seller delivers the vehicle loaded on board the vessel at the named Chinese port. The seller covers the vehicle, inland transport to the port, export customs clearance and loading. Risk passes to you once the vehicle is on board. You pay ocean freight, insurance, unloading, import clearance, duties and delivery inland.
What does CIF include?
Under CIF (Cost, Insurance and Freight), the seller also pays the ocean freight and a minimum level of cargo insurance to your named destination port. Note that risk still passes to the buyer when the vehicle is loaded in China — CIF changes who pays for freight, not who carries the risk at sea. The insurance is there to cover that risk.
| Cost or task | FOB | CIF |
|---|---|---|
| Vehicle and export preparation | Seller | Seller |
| Inland transport to China port | Seller | Seller |
| Export customs clearance | Seller | Seller |
| Ocean freight | Buyer | Seller |
| Cargo insurance | Buyer (optional) | Seller (minimum cover) |
| Risk passes to buyer | On board, China port | On board, China port |
| Unloading, import duties, taxes | Buyer | Buyer |
When is FOB the better choice?
- You import regularly and your forwarder has good rates on your route.
- You want to consolidate vehicles from several suppliers into one shipment.
- You need control over the shipping line, sailing date or insurance cover.
When is CIF the better choice?
- It is your first import and you want one landed-at-port price to compare suppliers.
- You do not have a forwarder in China.
- You are ordering a single vehicle or a small trial order.
How do I compare FOB and CIF quotes?
Ask your forwarder for a freight and insurance quote from the same Chinese port, add it to the FOB price, and compare with the CIF price. Remember to compare the insurance cover as well: CIF only requires minimum cover, so you may want to ask for broader cover on higher-value vehicles.
When you request a quote, say which term you prefer. If you are unsure, ask for both and compare. The export process page explains how quotes turn into a proforma invoice.
