For a while the question why are all the cars in Cuba old has been easy to answer as tight import laws have prevented Cubans from buying new cars. Only cars made before Fidel Castro took office in 1959 have been available to the masses so classics from Oldsmobile, Studebaker and Chevrolet are often found in Cuba.
The former approval process will also be dropped so the price will be set by market forces. Although state-owned firms are expected to benefit the most from these changes, even they will face 100% taxes on new vehicle, money which we’ve been told will fund public transport. The taxes and the low demand will see prices of new cars exceeding those of America. Some estimates suggest that Cubans will have to pay four times as much as Americans for the same vehicle.
Since Raul Castro took charge six years ago he’s lessened government control over private enterprises and he’s loosened control on overseas travel. With half a million workers being dropped from the public payroll, Castro’s clearly pushing the firm towards private enterprise. In a way the progress within the car market, delayed as it has been for decades, is a shame because the sight of 1950s cars on Cuban roads has become iconic.