Sales are down; auto bonanza comes to an end

12-23-2008 | TAGNIA SHOCRON S.

Tshocron@laestrella.com.pa

Financing restrictions and the devaluation of the dollar increases costs

Panama Star PANAMA. The world trend of auto demand points to a contraction of at least 10 percent, and Panama hasn’t escaped the trend.

Despite this, the president of the Association of Distributors of Automobiles (ADAP), Roberto Duran, has expressed optimism regarding next yearalthough he claims that the biggest problem facing the industry will will be the financing of cars. “If there is financing, cars will be sold, if there isn’t, they won’t,” he said.

Regarding the global decrease in car production, Duran said that the acquisition of cars could become more difficult, but says that at the moment there are enough cars already made.

The President of the rating company Equilibrium, Ernesto Bazan, lists other elements like the adjustment of credit policies by banks, who opted for more conservative practices, as a factor affecting the industry.

He explained that clients are now asked to come up with a higher down payment, while facing an earlier maturity date, higher interest rates, and greater requirements to qualify for a loan.

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