Auto parts are being packaged for exports at Chongqing Jiangjin Comprehensive Bonded Zone. (Photo/Jiangjin Media Convergence Center)

Chongqing - Chongqing is accelerating auto exports through the Knock-Down (KD) model, with Changan Q05 vehicle parts shipped via the New International Land-Sea Trade Corridor (ILSTC) to Thailand for assembly at Changan’s Rayong factory after fast-track customs clearance in April 2026.

The KD process involves breaking a vehicle into parts, shipping them overseas, and reassembling them at the destination factory, thus requiring precise supply chain coordination. On the other hand, transporting parts saves significant cargo space when compared with shipping a full vehicles.

And in Chongqing, the KD model enjoys an even clearer cost advantage. The ILSTC reduces parts transit time by about 30 percent compared with traditional sea routes, cuts overall logistics costs by around 20 percent, and maintains over 95 percent on-time delivery even during the rainy season.

Historically, China’s automotive industry began with KD. More than 30 years ago, Shanghai assembled the first Volkswagen Santana using mostly semi-knock-down parts imported from Germany. China's goal back then was to acquire process knowledge while gradually building a domestic supply chain.

Today, Chongqing-based automakers have become KD exporters of mature production processes, management standards, and supply chain systems.

KD exports are operationally more complex than shipping out assembled cars. Each vehicle contains tens of thousands of parts, and different suppliers and production batches complicate customs clearance, potentially causing delays and increasing costs.

To address these challenges, the Chongqing Jiangjin Comprehensive Bonded Area has consolidated warehousing and customs reporting. To support large-scale KD exports, it supports cross-dock coordination with transport hubs, single-declaration clearance, batch entry, and consolidated shipping.

From February to March, Changan’s KD shipments increased from 60 sets to 1200 sets. Total exports of Changan Q05 are expected to reach 4,500 sets in the second quarter. 

The KD model also mobilizes local suppliers of engines, chassis, and electronic components. Hence, Chongqing’s industrial standards are being gradually applied internationally.

KD exports are becoming more digitalized and service-oriented, with companies using Knock-Down Bill of Materials systems to digitally track and manage parts across the supply chain, ensuring components arrive in the correct sequence. Overseas industrial ecosystem development is also expanding into technical training, factory management support, and after-sales service systems.