Why is the US exporting used cars?

A huge percentage of the world's population has a dream of visiting the United States. The perception is that the USA is the land of opportunities, and everything that is produced or exported from the USA is of a superior quality. This obviously applies to cars. But, the question that arises, is the perception enough to justify the exponential increase in cars being exported to Dubai (small Middle Eastern sheikhdom), or is there supporting factors.

In a questionnaire collected from Dubai citizens studying at US based universities, the initial conclusion is that overall mechanical labor significantly costs less in Dubai when compared the US. This ultimately results in less cost to fixing mechanical problems. This confuses the puzzle, but with more in-depth interviews, the regular mechanic shops that charge the average labor rate lake quality. On the contradictory, the quality of dealership mechanical works matches its apposing at the US, however those dealership charges up to two times more of it's apposing at the US. Therefore, cars are more often maintained, and repaired at low quality shops; this strengthens the perception that two cars with identical miles, one driven on American roads, and other driven on Dubai Roads, the one driven in America would be of a much better quality.

However, this was not enough to convene me, and I researched for more justifications for the exponential increase. The research lead to that Dubai is one of the fastest-growing, flashiest and most multi-ethnic cities in the world. It is a city that welcomes anyone whose intention is to make money. Dubai Statistics Department announced that 2006 witnessed a sharp increase in the population, and an energetic development in every sector. About 292,000 become Dubai residents in 2006, increasing the population by 21 percent.

Furthermore, the department also revealed that about 212 thousands vehicles were registered for the first time in the same year. The department considered this an alarming number, which may result in a shift from the equilibrium in the car market. This is where deliberately and in deliberately, US based car dealers got on track to shipping cars towards Dubai. The shipments were generated by requests from Dubai local dealers. Of course, the fact that our dollar is weaker than the Euro, played to our advantage, allowing for cars that are shipped from the US to be more worth less in local Dubai currency.

To conclude, the economic boom that was initiated in 2000, in 2005 started to spread the boom to other parts of the Middle East. Currently it is noticed that Doha and Abu Dhabi are the cities benefiting from the wave of investment and development. It is important for US car dealers to capture on this growth supported by the world's globalization, and the efficiency of supply chain management, as the economic boom will at least last until the end of the current presidency period. The US economic policy will not change much until the next President has been elected to the White House. It is likely that we are witnessing a generational change in global wealth pattern, and that could provide evidence extremely durable for the Arabian gulf countries of the Middle East.

The typical car will go for its last drive sometime between its 10th and 15th year on Earth. At this point, the vast majority are sent to be recycled or sold for parts. But for a few autos, a second lease on life awaits, as a significant percentage are exported from richer nations to developing nations for a few more years on the road.

In countries across Africa and Latin America, old used cars from places like the U.S. and Europe provide vital access to transportation to people who would otherwise be unable to afford their own vehicles. While this process extends the lives of these cars, the practice is not without problems, in particular with regards to pollution and passenger safety.

In this episode of The Conversation Weekly, we speak with two researchers about why richer countries export used cars, what impacts they have in developing nations and whether import restrictions are effectively stemming the rise in pollution and accidents caused by this practice.

Paul Bledsoe is adjunct professorial lecturer at the Center for Environmental Policy at the American University in the U.S., where he specializes in energy, natural resources and climate change.

He says that “the process of retiring still-functioning cars off the road is going to speed up as electric vehicles become cheaper to buy and operate. And so when that happens, you may see a huge influx of used combustion-engine vehicles hitting the secondary market.” Bledsoe is concerned that, without the adequate policies in place, developing nations could see pollution skyrocket over the next decade as a result.

Festival Godwin Boateng is a research fellow at the Center for Sustainable Urban Development, at Columbia University in the U.S. He studies sustainable development in Africa through a postcolonial lens and has looked into the issue of old cars.

“Between 2015 and 2018 some 14 million used vehicles were exported from the European Union, Japan, and the U.S., with 40% of them ending up in African countries,” explains Boateng. “Just in Ghana, for every hundred vehicles on the road, 80 to 90 are used vehicles.”

While Festival recognized that used cars fill an important gap in providing transportation opportunities in Ghana, he says over 50% of used cars are over 15 years old. “So they tend to be really old and highly polluting. And to make matters waste, they tend to do modifications to these vehicles, which make them even more polluting.”

In an effort to combat the harms of old cars, in 2020, Ghana passed a new law aiming to restrict the import of cars that are more than 10 years old. With exports of old cars expected to increase as electric vehicles take over Western markets, policies like the law Ghana passed in 2020 may become more relevant.

Listen to the full episode of The Conversation Weekly to learn more about how old cars get to places like Ghana, the mixed bag of benefits and harms they have once they arrive and the ways to improve this situation.

This episode was written and produced by Mend Mariwany, who is also the executive producer of The Conversation Weekly. Eloise Stevens does our sound design, and our theme music is by Neeta Sarl.

You can find us on Twitter @TC_Audio, on Instagram at theconversationdotcom or via email. You can also subscribe to The Conversation’s free daily email here. A transcript of this episode will be available soon.

Listen to “The Conversation Weekly” via any of the apps listed above, download it directly via our RSS feed or find out how else to listen here.