Panama - Automotive Parts & Service EquipmentAutomotive-Parts-Service
The market for new automobiles showed substantial growth in 2014, after slower growth in the last previous years. Approximately 60,000 new cars were sold in 2014, resulting in increased demand for automotive parts and service equipment. The automotive inventory in Panama is estimated at over 1,000,000 units. U.S. participation in the automotive parts and service market is significant, with a market share of more than 40%. Main competitors include Japan, Korea, and Taiwan. However, the U.S. market position will improve as sales of U.S. cars increase. Demand will also remain strong for U.S.-made car parts and accessories for Japanese models.
It is important to note that cars are not subject to import duties, regardless of national content of origin. They are, however, subject to a progressive sales tax based on the value of the car. The U.S.–Panama Trade Promotion Agreement (TPA) does not, therefore, give a competitive advantage to U.S.-made cars. But, the TPA does give an advantage to U.S.-made automotive parts, which enter the market duty-free; there are no import restrictions on these products. Sub-sectors offering the best market opportunities are servicing equipment, tubes and tires, and engine parts.
Sub-Sector Best Prospects
Good prospects for U.S. exports include engine parts, pumps, filters, batteries, ignition parts, spark plugs, lamps, body parts, brake parts, shock absorbers, tires, exhaust components, and used or remanufactured parts especially for buses, dump trucks, and other commercial vehicles.
Panama is experiencing a construction boom, with approximately $15 billion in outstanding public sector projects alone, in addition to the Panama Canal expansion project and a number of private commercial and residential developments. This activity will bring excellent opportunities for U.S. exporters of auto and truck parts. In 2012, the Government of Panama completed replacement of the entire bus fleet serving Panama City and continues to impose greater regulations on car inspections, which has generated higher demand for automotive parts.
- American Chamber of Commerce in Panama: http://www.panamcham.com
- Business Panama: http://www.businesspanama.com
- Panama Chamber of Commerce: http://www.panacamara.com
- Expocomer (Commercial Trade Show): http://www.expocomer.com
Panama Automotive Trade Development and Promotion