Can I really finance a Silk Road trip, from India to the UK, by importing and selling the motorcycle?

Will You Break Even?

In my opinion you would be lucky to break even at the end of the trip. The wear-and-tear from such a long journey alone could cause the motorbike to devalue so much as to lose any margin of profit when reselling it.

Having said this, why not do some maths?

Assumptions

For the purpose of this answer I will be assuming the following:

1. You will fly to India
2. You will buy a new motorbike
3. You will drive all the way back from Madras to London (Why Madras? Because why not?)
4. You will drive on the best possible roads, to minimise wear-and-tear (ha!)
5. You will be able to pass all the custom checks in all the countries you will travel through
6. You will be able to import the bike in the UK (at a cost, of course)

Data Crunching

Let’s put some data down.

• According to this price check website the cost of a new Royal Enfield in India oscillates between 100,000 – 200,000INR (1074.7 – 2149.4GBP) using google and today’s rates – March 2015) depending on the model. Let’s pick an average 150,000INR (1612.05GBP ∼ 1600GBP).
• Now let’s look at the average selling price for Royal Enfield bikes in the UK, via ebay. A random generic search yields selling prices ranging 1200 – 3000GBP for used, non-collectors, models (those 99GBP ads you see are just the deposit for a new bike, whose real cost is something around 4999GBP).
• The air distance between Madras and London is 8218.75 km, to get a road distance estimate I would say multiply that by 3, which gives 24656.25km rounded up to 25,000km. (Funny side note, google refuses to calculate that journey.)
• It is safe to assume that your Royal Enfield will be quite beat after this 25,000km journey, and thus you won’t be able to sell it with just slight wear-and-tear, let alone brand new. An (overly) optimistic estimate could be selling it for less than half the price of a new one. I.e. something in the range of 2000GBP. You will have to at least clean it up and polish it, if you don’t consider changing oil, filter, gasket, transmission, etc.
• Consider an average petrol price of 1,20GBP per litre (this might be an overstimate), and an average mileage of 27.5 km-per-litre, you would be looking at a total estimated fuel cost of 25,000 / 27.5 * 1.2 = 1090.91GBP (∼ 1100GBP).

You’re Losing Money

Given the following data one can easily see that, by factoring in our estimates — buying price, wear, selling price and petrol costs — you are left with a loss of (+ 2000GBP – 1600GBP – 1100GBP) = -700GBP. This calculation is of course missing fundamental items such as food, accommodation, paperwork (and costs) at each border crossing, unforeseeable roadside maintenance operations, just to name a few. With this in mind, your loss could in fact be order of magnitudes higher — something along the lines of a few thousand pounds.

Royal Enfield Says No to Personal Imports!

According to the Royal Enfield Private Imports webpage, vehicles sold in India will not pass the UK MOT, so all our conjectures might in fact be a moo point:

The following points outline some of the factors that need to be considered in order to evaluate what is involved when you carry out a private import. The scenario is as per the current terms and conditions prevailing, but you should be aware that legislation is constantly changing in these countries to prevent such imports.

• Indian motorcycle models are different from EEC/UK/USA models and will not pass a Ministry of Transport (MOT) test.
• Models meant for other countries are not sold in India. The Indian model motorcycles cannot be registered in any other country other than India or SAARC nations as they do not meet the statutory norms prevailing there.
• All UK/EEC specification motorcycles comply with Whole Vehicle Type Approval (WVTA) and have VIN plates. From June 2003, all models of bike, not previously imported into the UK/EEC, must have a WVTA with the consequent VIN plate and Certificate of Conformity from Royal Enfield. All USA specification motorcycles comply with FMVSS rules and regulations and have a VIN plate. Each individual state in the USA also has registration rules that parallel the Federal rules so even if a bike somehow gets past US Customs the owner will most likely be unable to register the motorcycle.
• A motorcycle that does not comply with the UK or EEC or USA rules may not have valid insurance, thus leaving the owner liable to an insurance company refusing to pay out on any claim, including third party liability.
• Royal Enfield will not be liable for registration, compliance certificates or any documents whatsoever, which may be required for the private import of our bikes and it will be purely at the risk of the buyer.

Of course they might just be saying this because they want you to buy from their (more expensive) local dealers. Or maybe they actually know what they are talking about. Or maybe even a bit of both. Up to you to judge.

Where this legend probably got started is if someone purchased a bike not available in the destination country, or had enough celebrity status that the bike can be auctioned as “This is the bike that < Famous Person > rode from Mumbai to Amsterdam”. Globalization has all but eliminated the first case, and “it’s been done” has eliminated the second.

In order to sell the bike at the destination, it needs to be acceptable at the destination. Are emissions / engine controls / signals standards etc. the same in both countries? In many cases no, even if the vehicle was made in the destination country. “Made IN ” is not the same as “Made FOR “. I live in Japan, my bike is made in Taiwan. I can’t ship it back to Taiwan and sell it there, although I can probably drive it there for a month or so.

So, assuming it’s sellable you might get 50% of purchase for a late-model with 10,000km on it. And that’s after you pay any import taxes, ferries, inspections etc. So you might recover 30% of the purchase price.

That’s also assuming it arrives. There are only two possible routes between India and western Europe. South of the Caspian Sea goes through Iran, north goes through lots of places with -stan at the end. You will go through some rather rough parts, and some possible routes are through active war zones. You get nothing if you bend the frame after laying it down on what passes for a highway in a mountain pass somewhere, and less if it gets blown up.