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Cuba's classic cars calling out for U.S. imports of much-needed parts

02 / 01 / 2011

Jan 31, 2011. Aftermarket Business World. So tantalizingly close yet so far away, entry into the Republic of Cuba’s intriguing parts and repair marketplace remains out of reach for U.S.-based vendors. Although official relations between the two governments are still a frosty relic of the Cold War, efforts continue in the quest to drop the U.S.-imposed trade embargo and serve the service needs of Cuba’s famously creative shade-tree mechanics.

“As one of the world’s largest repositories of pre-1960s classic car models, Cuba would present a large potential market for those in the restoration and hot rod industry,” says Linda Spencer, international relations director for the Specialty Equipment Market Association (SEMA).

Vintage Detroit-built behemoths account for up to one in eight cars on the road, with the number of these vehicles topping 31,000. Up until the Cuban Revolution, the island was one of the largest importers of U.S. cars. Transportation needs and pure love for the stalwart vehicles has resulted in extraordinary efforts to keep them running, presenting a time capsule of functional classics. Some may now have Japanese diesel engines tucked under the hood among other fixes brought about by a paucity of appropriate repair parts; others remain in pristine condition.

“Cuba unfortunately does not translate into an immediate market for U.S. companies,” Spencer reports. “Of course, the biggest hurdle is that the current trade embargo doesn’t even allow Americans to sell into Cuba. In addition, sales in the short term would also be hampered by the current lack of disposable income in that country – limiting the ability of consumers to purchase U.S. products.”

Spencer does point out, however, that “if efforts by legislators to lift the ban succeed, shrewd manufacturers of spare parts for these aging beauties should immediately look to enter this market.”

It would seem to be a natural. Key West is closer to Havana than Miami; Cuba lies just 90 miles from the Florida coastline. The island has a great desire for U.S. auto components, to say nothing of an acute demand for tourist and development dollars. According to a communiqué from Cuba’s Ministry of Tourism, visitors from other nations were up 4 percent, amounting to 2.5 million people in 2010.

Canada is the No. 1 country of origin, accounting for close to 1 million vacationers to the culturally rich locale graced by sundrenched beaches. Restored classic cars, especially convertibles, are regularly rented out for trips across the countryside and jaunts into the vibrant and architecturally historic urban areas.

The long-outmoded restrictions prohibiting U.S. tourism and automotive trade should be a national embarrassment, observes Rick Shnitzler, lead organizer of the U.S.-based TailLight Diplomacy (TLD) advisory working group, which for years has been pressing for at least accelerated social exchanges among car buffs, if not outright sales of parts.

“Cuba’s pre-1960 Packards, Dodges and Pontiacs are our offspring, adopted at birth by Cubans who then kept them three-, four- and five-times longer than we did here at home,” he explains. “And as a U.S. citizen, I am embarrassed and ashamed that our politics prevents 90 percent of these cars from receiving correct world-class exterior and interior restorations, and 21st Century mechanical innovations,” Shnitzler contends.

“The whole thing is nuts,” declares Canadian journalist David Climenhaga, who has often visited Cuba and covered the automotive sector. “It doesn’t make sense on several levels: It’s cruel to the Cuban people and it isn’t helpful to American businesses.” Suppliers in Canada have held back on entering Cuba because “they would not want to jeopardize their relations with U.S. manufacturers,” he says.

“It would be a natural market for the U.S. The Americans have the competitive advantage because they’re right next door,” adds Climenhaga, also asserting that U.S. OEMs should be pushing hard to open up the Cuban marketplace for new-vehicle sales. Domestic carmakers could certainly gain from increased revenues if they were to efficiently transport vehicles by rail to Florida’s wharves for loading onto Cuba-bound ships, he notes.

“Access to a market of 11 million people who love GM products and paste Chevrolet bowtie logos on decrepit Ladas and Skodas might not save the Detroit Three, but it sure as heck wouldn’t hurt,” according to Climenhaga, who would like to see a Nixon-visits-China-type of breakthrough unfold. “I thought that when President Obama came into office there would be a quick change on that front,” he says.

“The Administration has been frankly timid in its willingness to change policy. We’ve been hearing rumors since August that the Administration was going to come up with reforms,” says Jake Colvin, executive director of the National Foreign Trade Council’s (NFTC) USA*Engage division in Washington, D.C. The pro-global business organization’s membership roster includes General Motors, Ford, Chrysler, Toyota, Caterpillar and Walmart.

“I wish I could be more optimistic right now,” says Colvin, citing a newly elected Republican majority in the U.S. House of Representatives that is likely to buck any Obama-proposed effort to open trade relations with Cuba. Raúl Castro needs to step up the pace of change in his country as well, according to Colvin.

“The potential is there to create more demand, but that would depend also on reforms in Cuba. There’s been no positive movement on either side. We’ve been stuck in the same holding pattern for a while,” he says. “It is in the U.S. government’s interest to have more contact with Cuba, whether it’s at the government level or people-to-people,” Colvin continues. “We’d like to see people getting together to talk about cars and other areas of interest. There is still room in Cuba for American car companies.”


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