Panama seen anchoring regional recovery – Wikifleet Central America
In 2022, Central America is expected to outperform the world in terms of economic recovery and leading the region will be Panama, according to the Economic Commission for Latin America and Caribbean Cepal.
Considering that the automotive industry is highly linked to economic forces, we are likely to see improvements in vehicle sales in Panama if semiconductor stocks around the globe start to make a gradual comeback next year as many experts are saying.
According to Panama Automobile Dealers Association (ADAP) Executive Director Patricia Vukelja, large strides in the vehicle industry are already being seen in 2021.
This year, the recovery of the automobile industry in Panama has been much more positive than expected, showing that there is demand and that people continue to invest in the purchase of cars.
From January to November, the auto industry in the country saw a 63% uptick from the year prior, but still some 23% down from the pre-pandemic (2019) level.
Although the worst of the COVID-19 pandemic looks to be behind us, the sector does face a new challenge and that is the issue of inventory. “There is still a semiconductor shortage which is affecting many products, and this includes cars,” Ms. Vikelja said on Radio Panama.
Last year (2020), the non-adjusted GDP per capita in Panama was US$12,274, according to Global Fleet’s Wikifleet page on the country. Meanwhile, although unemployment was quite high (18.5%), inflation (2.5%) and the benchmark interest rate (1.3%) were under control.
Panama Fleet Vehicles
Among the fleet vehicles available in Panama are the mid-size pickups RAM 1000 (known as the Fiat Toro in Brazil and Argentina) and the Peugeot Landtreck.
While the RAM 1000 is also available in the Central American countries of Guatemala, Honduras, and Nicaragua, the Landtreck is a new model being launched in Panama and Guatemala this year. The latter comes in a petrol or diesel engine model, and in a 4x4 or 4x2 traction version.
2021 Peugeot Landtrek (copyright: Peugeot)
Other popular brands in the country are Toyota, Hyundai, and Kia.
Panama has 1.22 million vehicles, approximately one vehicle per three inhabitants (including passenger cars, trucks, motorcycles, etc.) and 7 in 10 multinational companies offer company cars. Gasoline in the country is quite cheap, averaging approximately US$0.69 per liter compared to the US$1.25 world average (November 2021).
Central America Economy
While the average GDP in Latin America is expected to be up 5.9% in 2021, a 5.5% uptick is forecasted for Central America driven strongly by Panama (up 12%), according to Wikifleet based on Cepal data. Neighboring countries such as Guatemala and Costa Rica are seen up 4.6% and 3.7% respectively.
As for 2022, the average GDP in Latin America is seen up 2.9%. Central America is forecasted to increase 4.6%, being Panama (+8.2%), Guatemala (+4%), and Costa Rica (+3.5%).
For more on the fleet and mobility markets in Central America and other regions of the world, visit Wikifleet, a collaborative effort by the Global Fleet team covering five regions and nearly 50 countries around the world.