Trip to Panama

When we arrived in Panama, like most other tourists, we hired a car. We got the cheapest and most basic car from Budget, but with the compulsory insurances, it still cost us over $200 per week. We were staying and traveling in Panama for 12 weeks, so this blew a big hole in our budget. We decided early on that we would buy a cheap run-around and sell it at the end of the stay for maybe $1000 less. So off we went.

We hired a Spanish-speaking guide for the day, and asked him to take us to some car dealers. Our budget was $2500 and our expectations were high. This was a cheap country, right, so old cars had to be reasonable? Wrong. Nowhere had any vehicles under $5000, and these vehicles were old, tatty, and with at least 200,000 kms on the clock. We went to see one “bargain” at $2500. It turned out to be an ex-taxi with 300,000 kms, and a smashed windscreen. We were flabbergasted! We searched newspapers and the Internet for private sales and eventually bought the cheapest acceptable car we could find – a Lexus 400, 17 years old, well-worn and showing a very suspicious 41,000kms. The speedometer only worked occasionally, the petrol gauge could only be read with a torch, but at $3500 we jumped at it. It was a difficult car to sell due to it’s gas-guzzling 5 liter engine, so the locals did not want it, but I have to say, we traveled in comfort and style for the rest of the holiday!

We met a great Insurance agent who carefully, and in perfect English, explained what we did and did not need, and it cost us $160 for the year. This included roadside assistance and some months later when the radiator blew, this proved an amazing service. Within minutes of our phone call, Generali called us back having arranged a towtruck from the nearby village. We were 80kms (50 miles) out of Panama City, and expected a huge surcharge, but it was all free. The nicest guy arrived promptly and took the car and us back to our mechanic in Panama City, and all with a smile.

Speaking of our mechanic, we “inherited” Alvaro with the car. When we bought it, the seller kindly passed on the name and number of the mechanic who had serviced the car for the past 2 owners. He turned out to be a gem. He did all the paperwork for us, for $20, and serviced and fixed the car, as we needed him. New tires? No problem. He got them cheaper than we could and always provided us with invoices. When we left Panama to return to the States for 3 months, he offered to collect the car from the airport, garage it for us, and meet us at the airport upon our return. Our return time was a most unsociable 1.30 am, so we walked through Arrivals with doubt and trepidation. Surely he would have forgotten/overslept, or worse sold the car and disappeared. How wrong we were. Alvaro was there, car keys in his hand and a newly washed car just outside. The cost for this personal service? In Alvaro’s words. “For my customers, nothing!” What a great guy he is.

A further note to would be car-owners in Panama. Some ex-Pats have imported vehicles, but the problem there is that a car which may have cost less than $5000 in America is taxed on the Panamanian customs value – which is more than twice that value, so a large import duty is payable before the vehicle can be released. Basically a vehicle in Panama is a luxury item, there is no cheap way to own and run one. The Insurance is reasonable, but gas is 10% higher than in the US. It was a hefty $4.65 a gallon in June 2008 – half a day’s pay for the average Panamanian!

Labels: breaking down, buying a car, car insurance, driving in Panama, gas prices, Lexus 400, owning a car, Panama City, tow truck, vehicle import duty, Vehicles