It has been recently reported that the auto dealers in Cuba have sold only 50 cars and 4 motorbikes across the country in the last 6 months of the year. This decline in the sales of automobiles is because of a new law that has come into effect since January this year.
50 cars sold in first-half of 2014 in Cuba
This law particularly aims to restrict the automobile purchases for the first time in the past 50 years! However, the prices of the cars and motorbikes are already so high that only a few selected people can afford to buy them. Thus, the frustrated Cubans were happy to embrace this new law.
However, it appears that their happiness was quite short lived. The cars were sold at a price up to 400% or more than their actual price. Thus, the price of a family sedan became equivalent to a big-shot sports car. Majority of the population in Cuba earns about $20 per month. An autos dealership in Havana was charging a price of $91,000 for selling a used Peugeot which is roughly equal to INR 55, 00,000. The growth in the sales of the car encouraged them to price a Peugeot 508 for sale at $262,000.
The people of Cuba will have to request for authorization from their government before the beginning of this year to purchase automobiles. It was in the year 2011 only that the government of Cuba began to allow its people to purchase and sell cars from one another. Earlier the only automobiles that could be purchased and sold freely were the ones in Cuba before the 1959 revolution. This is the reason for the presence of numerous US made, vintage 1950s cars in the country. The government is planning to invest about 75% of the capital earned by selling the cars to enhance the nearly redundant public transport system.
Also see – Budget 2012 – Prices of Cars and Bikes hiked in India
Source – Reuters