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Dominican car buyers still await Free Trade’s lower prices

Dominican Today, Dominican Republic

Dominican car buyers still await Free Trade’s lower prices

1 June 2007

SANTO DOMINGO. - The local automotive market hasn’t benefited in the 3 months of the since the Dr-Cafta trade pact took effect, said the ex-president of Acofave, which groups the auto maker’s representatives.

Fernando Villanueva said the auto dealers haven’t been able to use the price reductions in the units they sell from the United States and this year their imports and sales could fall by 3,000 units.

The executive said the behavior perceived in the vehicle sector in the 5 months so far shows that sales will be lower this year. "In several occasions our sector has contacted Customs with the objective of arranging the advisable adjustments on the 20% clearing of the tariffs from the Dr-Cafta."

Among the factors which he said affect his sector’s timid behavior, is that people still await the lower prices resulting from the 20% import tariff clearing in the first year and another 20% in the second year.

More than 4,000 products enter the country free of tariffs, though with the vehicles it was agreed that a gradual clearing would be applied so the concessionaries and distributors adapt and sell the units already in stock.

ACOFAVE’s data show that in 2006 there was a rise in new car sales, which surpassed 27,000 units.