CBU stands for “Completely Built Up.” This refers to products that are fully assembled from their individual parts before sale and transport. These can include, for example, systems, machines, or vehicles. No further assembly is required in the destination country.
CBU for Vehicles
The term is most commonly encountered in the automotive sector. There, CBU refers to vehicles that are fully assembled and ready for use when they leave the factory. In customs documents, this form is also referred to as “Completely-Built Unit.”
CBU, SKD, and CKD Compared
The counterpart to CBU is what is known as a knock-down kit. These are manufactured in one country and undergo final assembly in another.
| CBU | SKD | CKD | |
|---|---|---|---|
| Meaning | Completely Built Up | Semi Knocked Down | Completely Knocked Down |
| Condition upon shipment | fully assembled | partially pre-assembled; for vehicles, e.g., with a welded, usually painted body | completely unassembled individual parts |
| Assembly in the destination country | none | Final assembly of subassemblies | complete assembly |
Why the distinction matters: Customs
Many countries treat the three forms differently when it comes to imports. In India, higher import duties apply to CBU passenger cars than to kits that are assembled domestically. Malaysia and Myanmar also impose lower duties on vehicles assembled domestically from kits. These countries aim to promote local assembly and employment through these measures. For manufacturers, the delivery format is therefore also a cost consideration.
What CBU Means for Transportation and Logistics
The delivery format determines how goods are packaged, transported, and handled:
- CBU: Finished vehicles are usually shipped as a single unit, often via Ro-Ro (roll-on/roll-off) ships: The vehicles roll on and off the ship under their own power.
- CKD: The parts are packaged and shipped in containers, often not as individual kits but bundled by part type.Thousands of parts must be assembled to make a single vehicle. Manufacturers and logistics service providers operate their own packaging and export centers for this purpose.
For warehousing and shipping, this means: With CBU, a finished product is moved as a whole. With SKD and CKD, a single product is broken down into many packages, which must be collected, packed, and checked for completeness.
