Importing The Nissan Skyline GT-R
What’s This About?
Six months ago, a nearly $1 million investment project was ready to make a small group of investors a very nice return on their capital. The project was to conduct crash and emissions tests for the Nissan Skyline R34 GT-R so that it could be legally modified, registered, and driven here in the United States. After countless phone calls and e-mails, con artists, pipe dreamers, and castle builders, the project had to be called off. Monetarily, logically, it cannot be done despite the hopes and dreams that many of us in the “tuner” world have. The three generations of the GTR from the 1990’s, the most popular of the long running series, cannot be imported to America without an extreme amount of cash to be lost. The reason why, however, is not so simple. The following paragraphs will finally put to rest all of the hopes, dreams, myths, rumors, scams, and falsities of the Nissan Skyline GTR here in America. I will outline every step of the importation process for the three GTR’s from the 1990’s; where they came from, why we want them, and why we cannot have them. It is not all bad news, however, there is still hope.
A Brief History
During a conversation with Andy Butler, Kozo Watanabe, The chief engineer on the production of the BCNR33 and BNR34 GT-R’s, very accurately states “The GT-R project has a long, long history.” After about fourteen years of the Skyline and Skyline GT model starting in the 1950’s, the Skyline GTR was born. It was in 1969 that the first Skyline GTR was released by Nissan. They set out to build a car that could compete in motorsport, specifically in the JAF Grand Prix. Not only did it compete, but in the first race, the GT-R came in second behind a Toyota 1600GT until the Toyota was disqualified bumping the GT-R to a first place finish. This botched first place victory was not enough for Nissan. They went on developing the Skyline and took 50 consecutive first place victories over the next two years and ten months.
This part of the story may start to become familiar with GT-R enthusiasts. The seventh generation called the “R31” was released in 1985. There was not a GT-R of this model, however, there would be what is called the GTS-4 in 1989 sporting an “RB” engine and ATTESSA four-wheel-drive.
On August 21, 1989, the Skyline BNR32 GT-R was released. This starts the story for illegal importations continuing up to the BNR34 GT-R that ceased production in 2002. For ease of writing and saving ink, I’ll refer to the cars as simply the R32 GT-R, R33 GT-R, and R34
GT-R. The three models all have important similar features that advanced with the models and years. These include the engine, the four-wheel-drive system, and the rear-wheel-steering system.
Why Didn’t We Get Any?
Before we get angry at Nissan for keeping the car out of America, it is important to ask “why?” Firstly, it was not Nissan’s concern in the 90’s to appease everyone in the American tuner community, which was in its infancy to say the least, by conducting expensive crash and emissions tests for their limited production cars. They did not anticipate a future demand because Paul Walker would be sporting them in the Fast and Furious series of movies. In reality, there were very few people who knew of the Nissan Skyline until the hit movie The Fast And The Furious was released in 2001. Popularity grew with each installment. In fact the latest installment, Fast Five, features Walker in a 1960’s GTR and at the end in a new GTR.
With that said, Nissan did not exactly neglect America at all. Andy Butler beautifully outlines what is called the “901 Project” in his book Skyline GTR: The Ultimate Japanese Supercar. He says “The Skyline was one third of the 901 Project being pursued by Nissan in the late 1980’s, the ‘901’ signifying the company’s desire to become the Number One car manufacturer for the 1990’s.” Japan got the Skyline and America got the Z32 300ZX. This is a very important event because this allowed for the few R33 GTR’s that can be legally imported.
In a phone interview, Nancy Acosta, secretary for G&K Automotive Conversion, outlined the extensive and expensive tests that must be done to drive a car on the roads here in the US. This applies whether the car was originally intended for sale here by the manufacturer or if the car is desired by an individual or a group of individuals. The three generations of GT-R fall in the latter category.
In order for a car to be driven on roads in America, it must meet many criteria. It has to pass tests put forth by various governmental agencies; US Customs, The National Highway Traffic and Safety Administration (NHTSA), The Department of Transportation (DOT), and The Environmental Protection Agency (EPA). If one wants to import any car that was never originally made for American streets, the car must be modified to conform to the EPA and DOT guidelines. This is where the process gets expensive. US Customs requires a 2.5% importation fee and DOT requires a bond worth 1.5 times the vehicle’s value along with an entry bond equal to the vehicle’s value.
EPA governs the general emissions aspect of the cars, DOT deals with the safety aspects. One would think a car made in Japan in the 1990’s and early 2000’s would have to be as safe as an American car and meet much of the same emissions. “Safety” of a vehicle (in America of course) is defined by DOT. Crash tests are designed to test just that. Without getting into much detail of what is involved in a crash test, cars must be destroyed and evaluated by any manufacturer looking to sell their vehicle in America. All information is taken by the car company whether it passes the tests or not. Next, the manufacturer will fix the problems that may have disqualified the car whatever they may be, and then crash the cars again. When the car passes all tests, the company knows what modifications they need to perform to make the car DOT compliant. As a side note, a car is DOT exempt after 25 years from the original date of manufacture.
From an environmental standpoint, a car must pass emissions tests. These tests must be done and the cars will be evaluated and fixed until they pass. Again, this is how the company knows what needs to be done to make a car US compliant. As a matching side note, a vehicle is EPA exempt after 21 years.
The Nissan Skyline models were never intended for the United States of America. Because of this there is no crash or emissions test data. In other words, we do not know what would need to be done to a car so that it would be legal here in America unless someone did crash and emissions tests. Nissan did not; what this means is that a third party company would have to put up the funding for all of these tests to be done and then modify the cars accordingly. An NHTSA memorandum released in 2008 indicates that such crash testing was performed by a third party company in 1998. This company petitioned for Nissan Skyline GTT and GTR models from 1990-1999. This would include the R32, R33, and R34 models. The company was granted permission to test and modify the 3 models of GT-R until much later when the R32 and R34 models were revoked because only the R33 GT-R had been tested. After a few tests, the company perfected the necessary modifications to make the R33 pass the DOT crash tests flawlessly. Some of these modifications include O2 sensors, seat reinforcement, quarter panel reinforcement, dashboard modifications, speedometer translation to MPH, side markers, tire placard, VIN plate, dashboard impact modification, and many more. Further, not just anyone can modify a car to be US legal. A company has to be registered as both an Independent Commercial Importer (ICI) and as a Registered Importer (RI). These certifications are filed with the US government. This verifies that a company can do the necessary EPA and DOT conversions so long as the information is available on what has to be done to bring the vehicle into compliance.
What Not To Do
A number of individuals have successfully brought Nissan Skyline GTR’s and other Skyline models into America. One can go on Craigslist and find a number of them for sale right now. Despite what anyone may tell you to sell their car to you, a Nissan Skyline is not legal unless it has NHTSA paperwork stating that a Registered Importer has legally imported the car and completed the necessary modifications to make the car DOT and EPA compliant to be driven on American roads. If the Skyline is 25 or more years old it does not need this paperwork because it is both EPA (21 years) and DOT exempt.
In fact, one can even register one of these illegal cars with what is called a “gray” VIN, or Vehicle Identification Number in many states (popularly done in Florida and New York). The cars cannot be registered with their original VIN because Japanese cars have a 12 digit VIN whereas all cars in America have a 17 digit VIN. The insurance companies and the Department of Motor Vehicles have a way around this. They assign the “gray” VIN and you’re on your way to having a registered car. So how is it illegal if it is registered by the Department of Motor Vehicles and has insurance? The fact of the matter is your insurance company does not know if the car is illegal, quite frankly they don’t care. They do, however, begin to care if one gets into an accident and someone gets hurt. What happens next is important: the insurance company will do a history check on the car. If they find the car is not DOT and EPA compliant, which they will, you’re in for it. The fines are extremely steep generally resulting in jail time and many other liabilities let alone the car will be seized and destroyed. When I say “steep,” I’m referring to a mere $20,000 fine per-day that the car was registered on the road. You would also be facing a US Customs case questioning how the car was imported. One would need a pricey lawyer to plea bargain that one down.
What a lot of these “gray” Skyline drivers do not know, or simply ignore, is that the government has a list of all these “gray” VIN cars and can investigate a case whenever they decide to. This is not to say that the Skylines are necessarily a special target or even a moderately high priority for government agencies such as ICE but they are definitely a red flag. In fact, there are many cars that have “gray” VIN’s, notably older Mercedes’. A lot of the Mercedes’ are DOT exempt however.
There was one company that was getting away with importing and selling “illegally” imported cars. They were importing Nissan Skyline GT-R’s, Nissan Silvia’s, and other cars that never hit American streets. The company was called Kaizo Industries and they were in their glory after the hit of Fast and Furious in 2008 (I’m not knocking Kaizo or Alison, it really was a good idea and had been done in the past by other companies countless times with different cars that were never imported into America. I really respect what he was doing in all aspects of his business). Paul Walker was sporting an extremely clean Kaizo imported R34 GT-S turned GT-R as the hero car in the movie. In the movie, Walker’s character obtains the Nissan R34 GT-R from an FBI impound lot. Ironically enough, this is where the car wound up a short while later. The FBI gives him the car because he is an agent and needs it to win a race for a big cartel bust. Articles came out about the Kaizo cars and people were buying them up. There were a number featured in The DuPont Registry, a magazine for fine automobiles, for well over $100,000. One was being offered by an exotic car dealership asking $160,000 which is a decent deal depending on how clean the car is. There weren’t exactly a lot of R34 GTR Vspec-II’s made.
Founder and owner of Kaizo Industries, Daryl Alison, briefly explained how Kaizo would import the vehicles. The shell of the car would be modified in a warehouse in Japan before being sent to his warehouse in Orange County, California. The body of the car would be stripped of the engine and drivetrain so it would be classified as an automotive component. This would get the car around the EPA guidelines at the time (this has changed). As Alison explained “The government doesn’t care that much about parts.” In an Edmunds Insideline article, Alison explains how the EPA guidelines state the following about Kit Cars: “The production, sale and importation of automotive bodies alone (i.e., no chassis, engine or transmission) are not regulated by EPA since such units are not considered ‘motor vehicles’ under the Clean Air Act. EPA form 3520-1 is not required for imported automotive bodies. A motor vehicle from which the engine has been removed is still a motor vehicle and is not considered a body.”
Page 13 of the Overview Of EPA Import Requirements For Vehicles And Engines states “EPA regulates the entire vehicle, not individual parts, for cars, light trucks, medium duty passenger vehicles (MDPVs), chassis-certified HDVs, and motorcycles. If an engine is not installed, and is to be used in a car, motorcycle, or light truck, it may be imported as an automotive part.” As a bullet directly under this paragraph the document states that you may not do the following: “Mounting an engine to a chassis to “manufacture” a vehicle without proper certification of conformity from EPA.” This is a major issue in the importation of these cars. The DOT stance on this is that taking something apart and putting it back together does not make something legal that was illegal.
The cars Alison imported were beautiful, the best of the best. He would find the best cars available in Japan to bring to America and sell for a profit because the cars were so scarce here. If you want to see one of the Kaizo cars in action, watch Fast and Furious, you won’t miss the Bayside Blue GT-R that Walker sports. To help put it into perspective, the R34 GT-R is rare in Japan, about 11,310 were made in total. Here it is literally unheard of to have a legal R34 GT-R. I have been in touch with Lori Haley, representative for ICE (U.S. Immigrations and Customs Enforcement) in the Department of Homeland Security. She sent me valuable information on the Kaizo case.
An article in The Orange County Register, provided by Haley, gives an account of what was going on at the Kaizo Industries facility. “Despite Kaizo’s public claims, the bodies themselves had not been modified to comply with Department of Transportation regulations. After arriving at Kaizo’s warehouse, several of the car bodies were then mated back with their original drive-trains and sold to the public. So the vehicles could be registered in the United States, the defendants allegedly put bogus 17-digit Vehicle Identification Numbers (VIN) on the cars in place of the actual Nissan VIN plate. To avoid California’s strict registration and emission requirements, many of the cars were registered out of the state and sold to California residents with Florida and Arizona plates.”
The author of the above news release hit the nail on the head. Kaizo Industries had many charges filed against them. Among them was not filing EPA form 3520-1 which is needed because the cars “were not new, were not imported by the original manufacturer(s), were not covered by EPA certificates of conformity, and did not bear EPA emission control labels.”
Unfortunately, all of the Kaizo cars were impounded, and many destroyed. The cars were even stripped from their owners who paid well over $100,000 for their cars and impounded. The hero car from Fast and Furious as mentioned above was impounded but resurfaced within the last few weeks in New York for sale for $30,000 as a movie production car (don’t get any ideas it cannot be legalized).
Project Skyline Abandoned
One may ask why the project explained in the beginning of this article was stopped. The reasons are for impracticality. The return on investment for legalizing the R34 Skyline GT-R simply does not exist. Let’s look at some numbers.
When the R34 Skyline GT-R came out in 1999, the average cost was 4,998,000 yen. This is equal to about $62,000 US, not exactly a cheap car to begin with. Because only 11,310 were produced, that value has not depreciated significantly because of how well the vehicle proved itself. To find a clean R34 GT-R (not Vspec, Vspec-II, M-spec, etc.) to import right now would run the person importing the car anywhere from $30,000 to $50,000. Just like the third party company did in 1998, the cars must be crash tested and emissions tested. So now we need to destroy about six of these cars just for testing. If we figure about $40,000 for each car, we’re at about $240,000. That’s just the cost of the cars. The import tax must be paid on each vehicle to be imported so that would be about $6000. Now, the cars must be prepped for crash testing and the testing lab must be paid. The reason they need to be crash tested is because they are only right hand drive and will not crash as a left hand drive car. The cars will be crashed, prepped, and crashed again until they pass all sections of the tests just like the DOT tests done in 1998. The cost of the testing minus the cost of the cars will be close to $700,000. Then the EPA tests must be done, this is relatively cheap except the modification part is expensive. After the EPA lab finds what needs to be changed, they must make the necessary changes to pass. Quotes I have gotten range from $20,000 to $50,000 per car. We’ll stick with $25,000 for our calculation. Once the tests are complete the cars will be modified. The cost for each modification for DOT will likely be about $20,000.
The market for the R34 is not exactly demanding, especially after so many people know what has happened as far as Kaizo car seizures. There are also many frauds trying to sell botched GT-R’s in exotic magazines such as DuPont right now. People are very weary about shelling out over $100,000 for a car that has a sketchy history.
For fifteen cars to be imported we have $840,000 for the cars (6 to be crashed), $21,000 for Import tax, $700,000 for the initial crash tests, $375,000 for EPA modifications, and $300,000 for DOT modifications. To have fifteen of the cars on the road and for sale with legal documentation we’re looking at $2,236,000. The break-even point for each car sale would be $149,066. To make a profit and pay back investors, one would need to import a massive amount of cars, let alone try to sell a Nissan that was originally $62,000 new for $160,000 twelve years later. Even if one did sell the car, it would only be $10,000 of profit. Unfortunately, passion and love for a particular car only goes so far and this is monetarily impractical. No matter how wealthy someone may be, it is hard to shell out over $2 million to buy something that is only worth $70,000 on the high end of the spectrum. Many Americans learned this lesson very well with the housing market collapse.
Nissan Skyline: A New Hope
There are a few things one can do to get the Skyline of their dreams. The easiest and most cost effective ways are: 1.) Move to Japan, New Zealand, Australia, or UK. Or 2.) Wait 25 years from the original date of manufacture. At the time of writing this, the R32 model is 22 years old which means its EPA exempt. By August of 2014 it will be 25 years old and legal to import without any testing done to the car. The good news about the R32 GT-R is that 43,934 were produced. This is almost four times as much as the R34 models so they’re going to be a lot easier to find and a lot cheaper to get a hold of than the R34 GT-R when it is 25 years old in 2024.
One can also go through the process and get an R33 GT-R through various RI and ICI companies. This is not a cheap process, however it can be done. A lot of RI’s and ICI’s do not like working with the Nissan Skyline and raise their prices because of the bad rapport associated with it and all of the legalities and responsibilities that come along with it. There is one model of R34 GT-R that can be imported for show and display purposes only. One needs to file with the NHTSA for a show and display exemption. The downside of this is that you would need to have EPA emissions done to the car to drive it on the road and you could only drive it up to 2500 miles per year. This special edition is the R34 Midnight Purple II Vspec II GT-R. Only 300 of these cars were made. The reason they are on the list to be exempt from the NHTSA is because they are rare and considered “Historically Significant.” It would be difficult, but certainly not impossible, for a Skyline GT-R enthusiast to get their hands on one of these cars in Japan to have brought to America. Again, one still has to go through US Customs and EPA processes for the car.
There is always the last option, simply going to Nissan and purchasing a Nissan GT-R. This is not to be confused with the previous R32 Skyline GT-R, R33 Skyline GT-R, or R34 Skyline GT-R. The Nissan GT-R was made available in the United States on July 4, 2008. Note that there is no prefix such as “R35” or “Skyline” used before the GT-R in America. For our purposes we’ll refer to it as the R35 as it is in Japan for consistency. One should expect to pay about $90,000-$95,000 for a new GT-R and anywhere from $60,000 to $80,000 pre owned. The R35 GT-R is a very beautiful car and I do not intend to take anything away from it, however, there are a few issues that some enthusiasts have with the car that separate it from its most recent three ancestors. For one, the car does not come with a manual transmission option. There are two sides to this issue. First, it takes away an enormous amount of personality from the car. This is the problem some auto enthusiasts have with the vehicle. On the other side, and probably more importantly, the GTR heritage has been all about using the best technology to produce the best, most advanced car on the road. Equipped with the DSG transmission system, the car does just that. It eliminates shifting time which can make a big difference in a quarter mile race or a road track. The car also lost the RB26DETT engine that it had sported through its reign. This is the first GTR since 1989 to have a different engine. The DETT part still exists but it is now a VR38DETT, a 3.8 litre V6 engine which is a very different layout from the inline six cylinder engine. The car is immensely fast with a 0-60 time of about 2.9 seconds and a quarter mile time of 11.2 seconds. It is exciting to many people in the GT-R and tuner world to see what Nissan will do next. For me, I can’t wait to see what the new model will add to the Nissan GT-R story.
Thank you to everyone who helped with information and interviews in contribution to this article, it is greatly appreciated.
Stay tuned here at Thisisrace.com for news and updates on the GT-R story. If you have any questions or comments, feel free to leave them here or contact us directly:
This Is Race
840 Long Island Ave
Deer Park, NY 11729
1 Andy Butler, Skyline GTR: The Ultimate Japanese Supercar, p.015 2 Ibid, pp.016-018 3 Ibid, p.021 4 Nancy Acosta, G&K Automotive 5 Wallace Labs 6 J.K. Motors Petition 7 Erin Riches, Edmunds Insideline 8 John Huffman, Edmunds Insideline 9 Ibid 10 Ibid 11 Overview of EPA Import Requirements for Vehicles and Engines 12 Ibid 13 Andy Butler, p.158 14 U.S. Immigration and Customs Enforcement News Release15 United States District Court 16 Andy Butler, p.155 17 Josh Jacquot, Edmunds Insideline