Confused Over CBU Or CKD Cars? This Might Help You To Decide

You must have come across terms like CBU or CKD while buying cars or bikes, especially those that belong to luxury space and to high-end segments.

For those who are not aware about these two terms and those who are confused over CBU and CKD, this write-up will come to your rescue.

Before describing the terms, it is noteworthy to mention that both CBU and CKD terminologies do not possess any difference in terms of technicalities. 

We all know cars and bikes are made at their respective companies’ manufacturing plants. However, owing to some reasons those vehicles cannot be manufactured at their country of origin (where the vehicle is supposed to be sold). In such a scenario, those vehicles are imported from other countries. This is where the concepts of CBU and CKD crop up.

CBU (Complete Built Up)

It means when an automobile is imported/exported to/from some other country as a complete vehicle fully assembled i.e., when a vehicle is completely built out of the target country as a whole piece. Most of the imported cars and bikes in India come as a CBU. CBU units does not require any assembly plant in the target country.

Some of the well known CBU units in India are Hyundai Santa fe, Honda CR-V, Yamaha YZF R1, Yamaha MT-09, and many more.

Below table shows the import duty imposed on CBU cars, two-wheelers, and commercial vehicles in India, according to data by Society of Indian Automobile Manufacturers (SIAM).

*CIF (Cost, Insurance and Freight)

CKD (Complete Knock Down)

CKD units require an assembly plant in the target country as the vehicles are shipped as fragmented parts. 

Such vehicles are first sent to an assembly plant in the target country where all the parts are assembled and then sold.

Some of the CKD cars in India include Renault Fluence, Jaguar’s XE, XF, XJ, Land Rover’s Evoque, Discovery Sport, and many others.

Below table shows the import duty imposed on CKD units in India, as per data by SIAM.