but where is the purchasing power that supports the demand for cars in a country where the average wage is $20 USD?
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The world's most prominent automakers are hungrily eyeing up Cuba after its rapprochement deal with the United States.
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| December 19, 2014 ©Yamil Lage (AFP/File) |
But
trade restrictions that are still in place for Americans and a litany
of concerns about Havana's policies means they are unlikely to dive in
any time soon.
Washington
and communist Cuba in December began the painstaking process of
restoring diplomatic relations and easing the five-decade-old trade
embargo.
President Barack Obama declared that the United States was ready for a "new chapter" in relations.
It
still needs Congress to fully lift the embargo -- and if that happens
it could take some time -- but businessmen are already looking for ways
to establish an early position in a country they expect could surge
economically with a bit more liberalization.
Automakers
at the Detroit auto show were not talking out loud about the
mouthwatering possibilities, but the potential for the largest island in
the Caribbean, with a population of 11 million, was on the minds of
many.
"We're very encouraged
by the news that the countries intend to normalize relations. We will
certainly evaluate any opportunities that may present themselves," said
Patrick Morrissey, a General Motors spokesman.
"We are studying the eventual opportunities for GM in Cuba."
Christine Becker, a spokeswoman for Ford, said they also were keeping an interested eye on Cuba.
"We
will review that initiative in order to determine its potential impact
for the industry. We have to better understand it. We don't rule
anything out for now," she said.
South
Korea's Kia, which produces some of the lowest-priced cars on the US
market, said it welcomed the change in policy toward Cuba, but told AFP
it too had no tangible plans for the island's market.
- 'Cuba an oasis' -
Experts
identify a number of hurdles automakers are going to have to overcome
in Cuba, which is famous for the decades-old classic American cars that
ply its dusty and unforgiving roads.
The
US embargo and other economic isolation forced by the communist economy
has denied car parts for those rich enough to have them, forcing
skilled Cuban mechanics to keep them alive for decades.
Akshay
Anand, an analyst at the industry specialist Kelley Blue Book, told
AFP: "No doubt there's a potential growth. Cubans love American cars,
the demand is there.
"You can look at it and say Cuba is an oasis for the automakers."
The
buying power of Cubans remains low, but with investment slowly
beginning to flow in to a range of businesses from agriculture to
tourism, a surge in demand for modern vehicles is seen as inevitable.
But the current limited US opening leaves most investment and sales by Americans tightly restricted.
It
allows Americans to sell farm equipment to support Cuban farmers; it is
not clear if that will extend, for instance, to pickup trucks.
In
the attractive shape of the vintage cars on Cuba's roads, Detroit has
an indelible history in the island's motoring sector, readily visible to
visitors.
Sometimes flashy
and often crudely patched and rickety Pontiacs, Plymouths, Dodges and
Chevrolets make up the island's 70,000 "almendrones," cars
affectionately called large almonds for their rounded shape.
There are also Peugeots, Skodas, Ladas and Chinese models that entered the country between the 1960s and 1990s.
They too depend on the skills of Cuban craftsmen-mechanics to keep them chugging along in the absence of replacement parts.
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