In Cuba, A Used Car Is No Bargain

In Cuba, A Used Car Is No Bargain
by Nick Miroff
October 31, 2011

What may be the most expensive Honda Civic in the world can be found in
Havana. There's nothing especially luxurious about the car: It's a red
2005 model, with 60,000 miles on the odometer.

But what is special about this Civic is that there are few like it on
the supply side of Cuba's used car market. And that's why Acela Claro
says she's had plenty of interest, even though she's offering it for
$65,000.

"I've been getting calls and emails from as far away as Madrid," Claro
says. She adds that the inquiries are coming from Cubans as well as
foreigners on the island who want a newer car.

Until a few weeks ago, there was no way to legally transfer ownership of
a vehicle like this. The only cars that could be freely bought and sold
were those built before 1959, when Fidel Castro came to power. That's
why there are still nearly 60,000 classic cars on Cuba's streets, but
few late-model Hondas. Bringing in a new car requires special government
permission and a 100 percent import tax, but Claro still says the U.S.
embargo is the reason she's asking so much.

This is probably the only country in the world where you don't have a
junkyard for cars. We simply get the wreckage and put it on wheels and
drive it again.

- Nelson Ramos, a car enthusiast

"Our country is so blockaded that we can't just bring in anything we
want," Claro says. "That's why a car like this doesn't cost the same as
it would [in the United States]."

The Cuban government has long treated car ownership as a privilege and a
reward, not a right. Doctors, military officers and exemplary workers
got the chance to buy one from the state, often at subsidized prices.

But since Cubans couldn't legally sell their vehicles, they learned to
do everything possible to keep them on the road.

Nelson Ramos, a car enthusiast and former economist in Havana, says cars
in Cuba are "like members of the family."

"Cars stay in the family forever. And you take care of the car, you fix
the engine, and we probably have the best mechanics in the world," Ramos
says. "This is probably the only country in the world where you don't
have a junkyard for cars. We simply get the wreckage and put it on
wheels and drive it again."

There's always been a black market for used cars in Cuba, and even now,
the best way to find vehicles is though illegal brokers or by going online.

Over slow dial-up Internet connections, Cubans who know how get around
government censors can shop on Craigslist-style classified sites like
Revolico or Cubisima. The prices are stunning. A 2006 Hyundai Accent is
priced at $40,000. A 1993 Volkswagen Jetta, $20,000. In a country where
the average wage is still around $20 a month, only Cubans with relatives
abroad or lucrative private businesses can pay such a fortune. But they do.

Waiting for passengers outside the Havana bus terminal, cab driver Pedro
Cantero shows off the green Russian Lada his father was allowed to
purchase in 1980 as a reward for cutting so much sugar cane. Cantero
says the battered sedan is still worth nearly $10,000 today in Cuba,
even more than when it first rolled off the Soviet assembly line.

"We're happy about the new change, because it removes an unnecessary
restriction," Cantero says. "I'm going to take better care of the car
knowing I can sell it if I need to."

But before any car owners in the U.S. start calculating what their used
vehicles might sell for in Cuba, they should keep in mind that between
the U.S. embargo and Cuba's own restrictions, neither government would
allow it.

http://www.npr.org/2011/10/31/141858419/in-cuba-a-used-car-is-no-bargain