Why I Don’t Regret Buying a Car in Ecuador

WHY I DON’T REGRET BUYING A CAR IN ECUADOR

Date    2024-08-02

Participants   
– Jason

00:00

If you’re watching this channel, that means you’re likely considering moving to Cuenca or somewhere else in Ecuador. This means that you’ve also likely come across expats telling you not to buy a car. That is the strong prevailing status quo amongst most expats that have moved to Cuenca. But one of the things that I love most about living in Ecuador is the freedom to choose your own path. Owning a car has been a critical component of my journey so far.

00:30

This video is all about why I love owning a car in Ecuador, but I will also cover why I generally recommend expats hold off from car ownership when they first arrive. Come join me.

00:48

But before we get to that, I do have some personal exciting news to share. Michelle and I just got engaged on the weekend. Yes, you could say that we were due and perhaps I have been dragging the chain a little bit on this one, but it finally happened here on the beach in Ayampe. We are super happy and excited for what the future brings.

01:10

I’ll probably do a video on why we decided to get married, as I have to admit it wasn’t something that I ever really considered before, but that segues perfectly into this topic. I probably would not have proposed to Michelle on this trip if we didn’t own a car. This entire trip would have been a lot different if we didn’t own a car, and I’m grateful for the additional options that owning a car has provided to us.

01:37

Now I’m certainly not saying that I wouldn’t have proposed if we didn’t own a car, It just would have happened somewhere else, probably in or close to Cuenca. This place, Ayampe, is a small village on Ecuador’s coast in the province of Manabi. It is one of my favorite coastal places in ecuador. Just look at it, it is beautiful. The surfing here is amazing, it is green. For me it is the ideal tiny little beach town in Ecuador. We absolutely love it. But traveling to smaller places like this would be very difficult for our family if we didn’t own a car. Of course, we could take a bus or hire a private driver and they are still, but both of these options just present their own challenges, which I will cover in a little bit as well.

02:23

A car provides unparalleled freedom period this is why we own a car. We can explore, we can get off the beat and track and just enjoy our time together in a comfortable environment. This means a lot to me and our family. Most weekends we do escape Cuenca and visit the nearby countryside and small towns like Paute and Sig Sig. And again, these are all accessible by public transport or with private drivers as well. And this is part of the nuance to deciding whether owning a car is worth it for you and your family.

02:56

On one hand, owning a car gives you the freedom to explore. But on the other hand, there are a bunch of cons to car ownership too. So let’s explore some of these cons right now. Let’s start off with probably the biggest one, and that is the cost. The cost of car ownership in Ecuador is the main deterrent for many expats and it is a very real deterrent. The gap has decreased in recent years, but the taxes and relatively small local market mean that the purchase price of a car in Ecuador is generally significantly more than, say, a car that you buy in the US.

03:34

Then you have the ongoing maintenance. This can be considerable given the potholes and just general state of a lot of the roads here in Ecuador. So finding a good, proactive and trustworthy mechanic is something that we’ve really struggled with. We do have a very good recommendation for you right now they’re called Carbox. I will provide a link to them in the description – they service the Cuenca area and these guys, what I love is they offer a pickup and delivery service of the car, so they’ll come to your house. Super, super convenient.

04:08

Then we have car registration. You will need to go through a yearly registration process where the car is checked for numerous issues including emissions. In Cuenca this process can be quite stringent, which is great at a high level because it ensures that the cars on Cuenca’s streets are not blowing smoke everywhere. But the process itself can be a little bit painful, especially for new expats.

04:33

When you buy the car, you will need to go through the proper transfer process, which can be done at any notary. Here is a video that includes this process when we purchased our car. 

And then of course, you need to be legally able to drive the car so you’re going to need a local Ecuadorian driver’s license. Now as a tourist, you are allowed to drive for your first three months here when you enter the country, but then after this, you really should get a local license. And there are generally two ways to do this. The 1st way or the easiest way I’m going to suggest is just getting your driving record from your passport country, the US, Australia, Europe, wherever it happens to be, getting that apostilled, and then sending that into Ecuador.

05:16

And that is the bulk of the process you’ll still need to submit some things on the Ecuadorian side, but that effectively gets you out of doing a lot of the local tests. So you’ve got your practical tests, you’ve got your theory tests that you do need to complete. 

But at the end of this, regardless of which path you take, you will need to complete the test. And this theory test is in Spanish. And so I definitely recommend studying for it because, yes, some questions are very common sense and you’ll pick them up. But there’s other questions that are quite detailed around numbers and, you know, penalties for certain offenses and whatnot that you simply are not going to know if you don’t spend a few days beforehand studying up for it and this issue leads very nicely into the next one, which is the police.

06:01

You will definitely need to deal with the police if you own a car in Ecuador. Wou will have interactions with them. That is just unavoidable. You’re going to go through checkpoints and things like that. At a high level, you know, checkpoints seem great. They’re there to stop the bad guys. But a lot of these checkpoints, it’s hard to think that they’re set up for any other reason than just making a little extra pocket money for the transit police or the transitos. This is particularly present along the coastal roads, but I have come across some closer to Cuenca as well.

06:38

Now, these situations can be particularly awkward for expats. I call it the dance. It generally starts out by them pointing out some sort of non issue or tiny issue. Maybe they’ll say that the treads on your tyres aren’t good enough, or maybe a brake light is out or maybe you’ve turned down the wrong way in a one way street which is actually a two way street but it’s very poorly signposted. Whatever – a non issue that’s created into some sort of an issue. And then they’re effectively going to give you 2 options. The first option is going to be a small fine if you pay it on the spot.

07:14

But if you want to challenge that, you’re welcome to, but you’re going to have to go to the police station and they’re going to issue a much bigger fine. And generally, under these sorts of circumstances, it can take a long time to go through this process of the dance until you finally come to some sort of number that kind of makes sense. 

For instance, I have spent 45 minutes in the past dancing with these transitos just to get their initial ask from $200 down to something that’s a little bit more palatable like $20. But this process is stressful and honestly, you do come away with it feeling quite dirty. My suggestion if you are in this scenario is to stay calm.

07:59

It can be very tempting just to go into angry gringo mode because you are clearly being taken advantage of and it feels awful, it feels dirty. I am a little ashamed to to say that I have lost my cool at the Transit Police over one of these issues and whilst my outburst did certainly make me feel a little bit better at the time, I did go away feeling that I really could have and and probably should have handled that situation a little bit better.

08:28

But don’t worry, I am very confident that I’ll have more opportunities to practice keeping my cool under the pressure of the Transitos. Just last week actually, I was stopped and I actually had quite a positive interaction with these police. We did something, I think one of the kids didn’t have a seat belt on properly and so they definitely could have fined us for this. But they did choose to let us go away with only a warning. And so I was very grateful for this particular interaction, but they definitely do not all end that way.

09:03

My final piece of advice when dealing with the police is really just to consider buying front and rear dash cams. It is perfectly legal to record videos of police doing their duty, and this can act as a substantial deterrent. But perhaps the most critical reason for buying a dash cam is to quickly provide evidence of your innocence if you’re involved in an accident. In Ecuador, if someone is injured in an accident, all drivers will be taken to jail until fault is established. And unfortunately, the default position is likely to be that because you’re the expat, you are at fault unless you can prove otherwise.

09:44

Now, this is the part of driving in Ecuador that does concern me the most. I certainly do not want to end up in jail here, especially if I’m not at fault. I do have a dash cam installed to help combat this and I do suggest that you do as well. 

Let’s talk about car insurance. Ecuadorians do largely see insurance as an unnecessary expense and as such, a very low percentage of cars on the road are actually insured. However, there is a very small compulsory medical insurance component that is included in the yearly car registration fee, which covers some of the medical expenses up to a certain amount.

10:25

Then after this amount, the insurance kicks in. Deductibles can also be quite high. For example, if I want to make a claim under my current insurance policy, then my deductible is going to be 20% of the claim value. So my car, let’s say it costs twenty thousand dollars. If that car gets stolen, it’s still going to cost me $4000 to get the additional sixteen thousand dollars back.

10:50

I will provide a link to an insurance broker in the description if you are looking for car insurance. 

Now other drivers. Dealing with other drivers can be really quite difficult here. I honestly don’t know sometimes whether I need to be more offensive or defensive, or sometimes I try and be both at the same time. It is kind of confusing and it actually can be a little bit stressful. Consideration of other drivers can also be seriously lacking. But The upshot of this is that because you really do need to pay a lot of attention on the road, other drivers know this and they do pay attention and so you don’t tend to come across some of these sort of fender benders that we might come across a little bit more back home.

11:33

I do find drivers in the Cuenca to be quite reasonable most of the time, much more so than driving in bigger cities of Quito and Guayaquil. I really dislike driving in Guayaquil, and check out this video if you want some details on what the drive from Cuenca to Guayaquil looks like and why I don’t like driving in Guayaquil. 

And then we straight up just have the responsibility of owning a car. Many expats that come to Ecuador just don’t want the overall responsibility of owning a car here.

12:05

Perhaps they’re deliberately downsizing all of their possessions when they move to Ecuador and so a car just doesn’t fit in that picture anymore. Or perhaps they just want to spend more time traveling outside of Ecuador, so car ownership is just an unnecessary expense that they don’t need right now. Whatever the individual circumstances may be, ultimately the responsibility of car ownership can be an unwelcome burden and I absolutely get that.

12:49

That is a huge list of cons. It is a lot for any would-be car owners to take in. So I do understand why some expats just put car ownership in the two hard baskets. Now, before I get too negative, let’s touch on some of the additional pros or benefits of owning a car here. In addition to freedom, here are some other reasons that work for our family.

13:13

Firstly, just kids after school activities. We have three kids and one more on the way and so our afternoons are generally filled with random activities like martial arts, swimming and other lessons. And then we have the weekend birthday parties and generally just lots of moving around from place to place. Now it is certainly possible to organize transport for a lot of the after school activities and of course we can take taxis to go from place to place, but these options are just not as convenient for us and we just wouldn’t be able to fit as much in if we were using these options rather than earning a car ourselves.

13:52

Another key reason for us is just friends and family. We love it when friends and family take the time and effort to come and visit us in Cuenca, and especially those that come visit us from overseas and maybe they don’t speak the language. Like for example, my parents, they’re here right now in Ayampe from Australia and they’ve previously visited us in Cuenca as well. Michelle works in tourism. It would be very easy for us to organize things like day trips, airport transfers and all that sort of stuff, but there is just nothing quite like the personalized service of picking up your loved ones from the airport or visiting places together.

14:31

Michelle’s family also comes and visits us a lot from Quito and so we’re always doing little airport runs and we have basically a full load of passengers in our car very often throughout our lives in Cuenca. 

And then we have my work, you probably know that at YapaTree our main income generating activity is our real estate activities buying, selling, renting. And I spend most of my time on site either listing properties or viewing them with clients. And we deliberately purchased a bigger car so we can comfortably take our clients around town.

15:06

Here’s a video of one of our recent real estate trips. And my car certainly plays a significant part in it. 

So I think that’s a pretty good summary of the arguments from both sides on car ownership. If I wanted to simplify it more, I would just blow the decision down to how much you value the freedom that a car would provide to your life in Ecuador. If this is more than the initial and ongoing cost, then I definitely think it’s worthwhile at least considering buying a car. 

But why do most expats decide that owning a car is not for them? Obviously I’ve just gone through the cons, but let’s mix those with the lifestyle that a lot of expats have in Cuenca.

15:49

In my experience, most of the expats that do move to Cuenca don’t actually need or value the freedom that comes with car ownership. Let me dig into this a little bit more. On a day to day basis, many expats find that they can choose to live in a neighborhood that has good public transport options, including the Tranvia buses and taxis. Some love to walk all over town and just find that all of their daily needs like supermarkets and that sort of stuff can be found in their immediate neighborhoods. Some popular areas that have really good transport options include El Centro, Zona Rosa, El Vergel, Puertas de Sol, Gringolandia, Primero de Mayo and some parts of Misicata.

16:35

But then you’ve got your fringe areas like Challuabamba, San Joaquin and Tarqui which are further out but still have access to buses to commute to Cuenca. For example, whenever a property buyer starts their buying process in Cuenca, often the suburb of Challuabamba will come up because it is a popular option with good amenities and warmer weather. But then one of the key questions I always ask to prospective buyers is how often they want to be spending in Cuenca. By this I mean, if they want to visit every day, then owning a car is absolutely going to provide them with a core benefit.

17:13

But if they only want to visit once per week, then perhaps taking a bus or taxi is very workable for them and so they can choose this neighborhood without having to go through the effort of buying a car. 

Now owning a car does open up a bunch of different potential living options, but in my experience many expats aren’t looking for a lot of these options anyway. It’s really horses for courses. 

And then of course you do have the option of the private drivers for those day trips or transfers in and out of airports like Guayaquil.

17:48

Driver costs are going to vary, but you can find drivers that charge less than say $100 per day. So this can be a very cost effective way compared with the cost of outright car ownership. So with all that being said, should you buy a car? Maybe. I don’t know. How much is freedom worth to you? How often do you travel outside of Cuenca? If you’re going to be using the car for adventures with friends and family every week, then to me that’s an easy yes, you should potentially look at buying a car.

18:22

But if you’re planning to use less than this, then it does become a little bit more of a difficult judgment call. And do you want to live 20 or 30 minutes outside of Cuenca but still have easy access to it? Then owning a car becomes more of a necessity too. Or maybe you’re living in Ecuador because the cost of living is your primary driver. If so, you definitely don’t want to be considering owning a car because that’s just going to push your expenses way up. 

So let’s assume you’ve decided that maybe you do want to look at buying a car. Question then moves to what type of car should you buy? And I really should do an entire video on this topic but in a nutshell, there are two main trains of thought when it comes to what type of car you should buy.

19:07

The prevalent thinking is that you should buy a car that is bought and sold commercially. Now, what I mean by this is that this car has enough of a market in Ecuador that it is relatively common to find them and the idea is that when you go and sell the car, you shouldn’t have too much trouble. You’ll also find that getting spare parts are relatively straightforward because a lot of people have this car, there is a market for it, you can get it.

19:30

It may be more expensive than what you used to, but hopefully the cheap labor costs will help absorb some of that difference. The other camp will suggest that owning a cheaper Chinese made car is the better option. To me there is just not enough evidence to suggest that this is the better option. There are some brands like Jac that have been in Ecuador for let’s say 10 years or so. And so they have effectively proven themselves and you can find some spare parts relatively easy. 

But there are a lot of other Chinese car brands that just do not have this history.

20:06

And so it’s just much more difficult to be super comfortable buying one of these cars because maybe you can’t find the parts easily, maybe the depreciation is going to be a lot. There’s just a lot of different unknowns which make it really hard for me to consider buying one of these cars. We obviously went down the train of thought of buying a proven brand, a proven make, which does have some sort of market. We’ve gone with the Toyota Highlander. There are really strong points to either side of this debate.

20:38

Now, if the EVs do start to take off here in Ecuador, then I do think that the Chinese cars will become a little bit more dominant because they pretty much own the EV market at the moment, especially on the cheaper end. So that’ll be interesting to see how that takes off. Until then, I’m just going to stick with what my Ecuadorian family tells me and that is to buy commercial cars. 

Have you considered buying a car here in Ecuador? If so, I would love to hear your thoughts in the comments below.

21:05

Now I’m off to grab some more waves here in Ayampe. It’s a little bit too dark for surfing, but I can certainly get a quick little swim in. I just do love it here. It’s so green, it’s so fresh. It is beautiful. And so if you’re traveling by bus or by private car or your own car, I do suggest checking out Ayampe. It is just gorgeous. Put it on your Ecuador travel list. 

Thank you very much for watching and maybe check out this video next where we purchased our car in Quito. Ciao ciao.