Cuban <b>car prices</b> skyrocket under new law - Digital Journal |
| Cuban <b>car prices</b> skyrocket under new law - Digital Journal Posted: 09 Jan 2014 05:08 AM PST While Cubans are finally able to purchase cars without government permission for the first time since 1959, prices on new and used vehicles are creating the ultimate sticker shock. For the first time since the 1959 revolution when Cuba converted to communism, Cubans have the right to buy new and used vehicles from the state without government permission. While this initially made many Cuban's ecstatic to head to the dealership, the mark-ups that are coming along with new and used cars are making them take a step back. Reuters is reporting that price markups of 400 percent on new vehicles in the country. "I earn 600 Cuban pesos per month (approximately $30). That means in my whole life I can't buy one of these. I am going to die before I can buy a new car," Cuban citizen Roberto Gonzales told Reuters. "With these prices ... those who will be able to buy are the privileged, or the bandits," Alfredo Boue, a 25-year-old cook, told Fox News. "I think the bandits are not the ones (stealing) in the streets, but the people who set these prices." "These prices will clearly be outside the purchasing capability of the vast majority of Cubans, even with the support from relatives abroad. In essence, they represent a luxury tax imposed by the government on the nouveau riches of Cuba," said John Kirk, one of Canada's leading academic experts on Latin America. The new law eliminates the need for drivers to wait for an authorization permit from the government, but the government still has the monopoly on importing automobiles directly into Cuba. Changes to the system two years ago allowed newer models to be sold to people once they received approval from the government. These new regulations rid the approval process, in part of Cuba's president, Raul Castro's effort to increase citizen's freedom. Just because the nation is opening up its automotive market doesn't mean they are making it affordable for all citizens. Newer vehicle models can attach up to a 100-per cent tax, meant to fund Cuba's public transport system, according to the Communist Party's newspaper, Granma. Bert Hoffmann, a Cuba expert at the German Institute of Global and Area Studies in Hamburg, Germany, told Autonews, "The state monopoly on retail remains sacred, and this means high prices. If cars are for private use, these high prices function as an understandable 'luxury tax.' But as cars and vans are widely used for business purposes, these high costs also are a strong brake on more dynamic development." |
| Are Diesel <b>Cars Cost</b> Effective? - Business Insider Posted: 10 Jan 2014 08:53 AM PST ![]() Alex Davies / Business Insider After 40,000 miles, the BMW 328d diesel becomes a good deal. That's because cars powered by diesel are significantly more efficient than those with gasoline in the tank, especially on the highway. But diesel fuel is more expensive than gasoline (thanks to dumb fiscal policy dating back to the '80s), and the cars themselves are usually more expensive by a few thousand dollars. So how many miles does it take in a new diesel to see the savings at the pump make up for those extra costs? A lot, it turns out. Using EPA-rated combined fuel economy numbers, base prices, and the national average price for regular gas, premium gas, and diesel (from AAA, for January 9), we compared nine pairs of diesel and gasoline cars. Apart from the engine, there aren't significant differences between the cars in each pair. Here's the chart. You can see the base price difference for each, how much money using diesel saves per mile, and how many miles driven make up for the extra cost. We've noted cars that use premium gasoline in red, and the most cost-effective diesel model in green. Cars are model year 2014 unless otherwise noted. Click to enlarge: It's not surprising that the break even mileage number is the lowest for the luxury cars — premium gasoline is closer to the price of diesel. And the markup for a diesel engine has less impact when the gasoline version is worth over $30,000. Based on our math, the Chevy Cruze Diesel and VW Jetta TDI will never break even, because their fuel economy numbers aren't good enough compared to the gas version to make driving on diesel more efficient. The best option is BMW's 328d, a car we recently reviewed and liked a lot. So if you're looking to save money with a compact car, diesel isn't the way to go. If you want to spend less time at the pump and feel the savings before you put 100,000 miles on the odometer, BMW has some cars that should interest you. Thanks to reader Andrew Maddox for suggesting this idea. |
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