Cuba Car Sales Fail over Sky High Prices

HAVANA TIMES — Cubans purchased only 50 cars and four motorbikes after the reform last January that allows for the state car dealers to “freely” sell new and used vehicles, according to official media reported on Tuesday.

New vehicle sales no longer require a “letter of authorization” from the government, although state dealers offered from the beginning the new and used cars at astronomical prices.

The profits, according to the government, are to go to improve public transportation.

The 50 cars and four motorcycles sold the state reported revenue 1,283,000 convertible pesos (the US dollar equivalent), Radio Rebelde said on its website.

The average sale price of the vehicles was $23,800, with the vast majority being used cars.

The opening for new car sales announced by the government of Raul Castro in December 2013, came after decades of restrictions.

Market liberalization, however, caused unrest in the population due to the sky-high prices, which multiplied by up to eight times the price of the autos on the international market.

Many new cars from European manufacturers were offered at prices of over $100,000 with a Peugeot 508 model topping the list at $269,000. The average wage in Cuba’s state sector is around $20 a month.

In Cuba it was not possible to buy new cars for decades. The Castro government abolished the free automotive market shortly after the triumph of the 1959 revolution.

The State then maintained for decades a control on the purchase and delivery of vehicles, usually given as rewards for service to some officials or doctors.

Cars in Cuba are known for being one of the oldest in the world. On the streets of Havana abound American-made cars from the first half of the 20th century, and Soviet models like the Lada or Moskovich. Lately there are more Chinese-made cars.