In Sri Lanka, the economic crisis turns into a boon for used car dealers
The government’s two-year import ban on vehicles has forced desperate buyers to pay hefty sums for no-frills family sedans in local markets
In this photo taken on January 12, 2022, a mechanic works on a car at a repair garage in Colombo. (Photo by ISHARA S. KODIKARA / AFP)
Dove: Supermarket shelves are empty and restaurants can’t serve meals, but Sri Lanka’s economic crisis is a boon for used-car dealers, with vehicle shortages pushing prices higher than a house in a nice neighborhood.
The island nation of 22 million is on the brink of bankruptcy, inflation is searing and the government has banned a range of ‘non-essential’ imports to save the dollars needed to buy food, medicine and fuel.
In the auto market, this two-year ban has kept factory-new cars off local roads, forcing desperate buyers to pay some of the highest prices in the world for battered compacts and no-frills family sedans.
Anthony Fernando spent a recent weekend browsing sales lots in suburban Colombo on behalf of his daughter, who has been trying to find an affordable set of wheels for nearly a year.
“She thought the prices would go down,” the 63-year-old said AFPbut now she “pays to procrastinate”.
The prices went “beyond the reach of an ordinary person”, he said.
A five-year-old Toyota Land Cruiser was being offered online for 62.5 million rupees ($312,500) – triple the pre-ban rate, and enough to buy a house in a middle-class area of Colombo or a new luxury apartment downtown.
A ten-year-old five-seater Fiat with a failed engine that could be stripped for parts elsewhere was listed at $8,250, more than twice the average annual income in Sri Lanka.
“A car and a house are symbols of success,” said smiling Sarath Yapa Bandara, owner of one of the capital’s biggest car dealerships.
“That’s why most people are willing to buy even at these high prices.”
– ‘Out of this world’ –
Owning a car remains a virtual necessity on the congested streets of Colombo, where a ramshackle bus and train network was already struggling with overcrowding.