14ymedio, Havana, February 21, 2020 — On Friday the state-owned company Cimex published on its website a price list for used cars that it will begin selling next week. The list includes thirty models priced from $34,000 to $90,000, which must be paid for up front using a bank card or credit card.
The company, which is controlled by the Cuban military, released a memo stating that the sale of second-hand cars would begin on Tuesday, February 25, and indicating that payment, which previously could be made in convertible Cuban pesos (CUC), must now be made in “freely convertible currency” (MLC).
Many Cubans have described the prices as “rip-offs” in the comments section of the company’s Facebook page.
“The managers handling this process have shown a great lack of respect in releasing a price list from almost 10 years ago and discounting it only 10%. They have not taken into consideration that these car prices, last published in 2013 or 2014, were for cars that were already at least at five years old at the time. The vehicles are even more depreciated now,” wrote Valentina Montalvo.
In her comments Xiomara Cruz Hernández used the word “rip-off,” adding at the end, “If nobody buys them, they will either have to discount them or eat them…”
The young actor Pedro Rojas wrote that Cimex should “keep in mind the value of these automobliles on the international market,” where “prices would not be based on the little pieces of colored CUC paper” but on dollars. He concludes, “These prices are not real. They are very inflated… A bit of objectivity and market analysis… And furthermore they are used.”
At the start of this month it was announced that Cubans would be able to buy cars through the government for hard currency. “Even if this measure won’t have a direct impact on the majority of the population, it will contribute to the improvement of public transport,” said then minister of transport Eduardo Rodríguez Dávila.
Rodríguez Dávila noted that autos are in high demand due to difficulties getting around on public transportation. He also took pains to emphasize that 85% of the proceeds from their sales will go to a fund to develop public transport, a fund to which companies must contribute at the end of each month.
Vehicle prices will be reduced 10% as part of the sale, which will begin in the capital before being extended to the rest of the island. Methods of payment will be the same as for home appliances and electronics, which took effect in Cuba last October.
Imports of new vehicles will be made upon customer request to the agency, as has been the cases with hard currency purchases since 2014. Imports of engine motors will be handled through the state-owned companies Cimex or Zaza.
The range of products (including automobiles) extends the dollar’s scope as a currency in the domestic market, sounds the “death knell” for the convertible peso (CUC) and reduces the functional capacity of the Cuban peso (CUP).
— Pedro Monreal (@pmmonreal) February 7, 2020
After the announcement, the Cuban economist Pedro Monreal said on Twitter that this sale of cars to Cubans through government companies sounds the “death knell” of the CUC and confirms the dollarization of the domestic market. “The growing range of products (including cars) expands the dollar’s scope as a currency in the domestic market.”
Meanwhile, the economist Elías Amor stated on Radio Televisión Martí, “What the government is trying to do is raise more hard currency to cover the state budget, but this won’t benefit or address the needs of the Cuban people.”
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