Ultimate Guide To Buying A New Car In Italy

If you’re relocating to Italy and planning to stay in the country long term, then you should certainly consider buying a car. This will help you get around without having to rely on public transportation. Public transport is very good in urban areas of Italy and for going from one city to another. But once you are in the rural areas, public transport is very limited.

Having your own car in Italy will give you the freedom to travel the country, take unplanned day trips and commute to your work each day. The Italian roads are well maintained and it’s a real pleasure to drive around the country appreciating the iconic scenery.

Obviously you do not have to buy a new car. There are plenty of used cars that you can buy. But keep in mind there is a slight difference in the quality of used cars between Italy and that of the United States. In the US, there is a long tradition of leasing vehicles. Most leases are for three years. This means that there are plenty of used cars available in the market that are relatively new and well maintained. In fact, most car manufacturers offer certified used cars.

This is not the case in Italy. It is not that easy to find high quality used cars. Italians rarely lease cars. Once they buy a car, they tend to drive it around a lot. Italian roads, parking garages and street parking is not the same as in the United States. Based on my observation, a three year old car in Italy with a certain number of miles will look and feel a lot older than a similar car in the US.

What Do You Need To Buy A New Car In Italy?

There are a few things you need to buy a new car in Italy:

  • To legally buy a new car in Italy you need to have a Residency Permit. This is because you have to pay an annual tax called the ‘Bollo’. This has to be paid in the region that you live in so you need the Residency Permit to prove where you are living in Italy. Once you have an address in Italy you can apply for your Residency Permit straight away at the local town hall or the police headquarters.
  • You also need to have a Tax Code (Codice Fiscale) to buy a car in Italy.
  • You should have a driving license that is valid for driving in Italy.

Buying A New Car – A Quick Step by Step Guide.

The following are the key high level steps involved in buying a new car in Italy:

  • First decide whether you want to buy or lease the car. Leasing a car is rare in Italy. Leasing is typically done by people who have their own companies or by large corporations.
  • Contact your insurance company and inform them of the upcoming purchase and provide details. Expect the insurance rates to be high even if you are a very experienced driver. This is because you do not have much of a driving history in Italy.
  • Make sure that you have secured the finances needed for your purchase or lease.
  • At the dealership, present your documents (Residency Permit and Tax Code). The dealership will make copies of your documents.
  • Pay for the car in full at the dealership or garage.
  • The dealership will register the new car in your name and give you the registration number.
  • You will need to call your insurance company and give them the details of the new car. Your insurance company will confirm that you’ve paid the necessary insurance for the car.
  • You can pickup the car and drive away!

Which Is The Most Popular Car In Italy?

Although Italy is best known for its Ferraris and other high-end sports cars, most Italians are far more practical when it comes to buying a car. In fact, most of the towns and cities in Italy are full of narrow, winding roads, many of which would be impossible to navigate in a large supercar!

Fuel prices in Italy are also very high compared to other parts of the world so buying a car that is fuel-efficient is a critical factor in the selection process for the majority of people in Italy. Consequently, the most popular cars in Italy tend to be small and fuel-efficient.

One of the most popular car in Italy is the Fiat Panda which had around 112,000 new car registrations in 2021. The Fiat Panda is a compact 5-door hatchback that is perfectly suited for driving down narrow town and city streets.

It’s also easy to park, even in a tiny spot, and has good fuel efficiency. A new Fiat Panda costs under 15,000 Euros although you can buy upgraded versions that cost upwards of 20,000 Euros.

Fiat is Italy’s favorite brand of car and so it’s no surprise that the second most popular car is the Fiat 500, which had almost 45,000 new car registrations in 2021. This is also a compact car that is useful for town and city living although there’s not much room for luggage in the trunk!

Other popular cars in Italy are the Lancia Ypsilon, Jeep Renegade, Toyota Yaris, Fiat 500 and the Citroen C3.

Which Is The Most Reliable Car Brand In Italy?

While Fiat is by far the most popular brand of car in Italy, it’s not famous for being particularly reliable! Of course, it’s a fantastic vehicle for driving around town or making short trips to the supermarket but it’s definitely not designed for long-distance driving or touring.

In fact, Italian car brands have a bad reputation in general when it comes to reliability. Even the top brand such as Ferrari can often have problems when it comes to overall reliability compared to some of their competitors in other parts of the world.

For urban living, the most reliable Italian car brand is the Lancia Ypsilon. Lancia is an Italian car company owned by Fiat. Lancia currently only sells cars in Italy and they only make the Lancia Ypsilon!! This small, easy-handling car is an extremely popular car in Italy (sells about 44,000 units per year). The new Lancia Ypsilon is a good all-round car that is marketed as a ‘supermini’ with the third generation of the model.

However, when it comes to reliability it’s hard to beat the French brand Citroen or the German brand BMW. These cars are a little more expensive than their Italian counterparts and it’s worth remembering that you might have to order spare parts from overseas if something does go wrong.

These foreign brands might be a good option if you are planning road trips and driving long distances but for regular life in Italy, you’d be better served by either a Fiat Panda, a Fiat 500 or, best yet, a Lancia Ypsilon.

Should You Get A Small Or Large New Car?

For town and city living, a small car is going to be much more convenient and cost-effective. The price of a small Fiat, for example, starts at under 15,000 Euros and the fuel efficiency is good. The roads and parking spots in the towns and cities are tiny compared to what most Americans and Western Europeans are used to. This means a small car it will take some getting used to!

Owning a small car is especially important if you’re living in a historic location. These places were not built with cars and heavy traffic in mind so it can be very difficult to get around if you’re driving a larger vehicle.

Small cars are also cheaper to insure – a legal requirement in Italy. This will save you a considerable amount of money in the long term. They are also much more fuel-efficient which will also help to keep your costs down.

The main problem with the smaller cars that are popular in Italy is that they are not well suited to long-distance driving or road trips. This can be an issue for a lot of Expats who want to explore Italy while they are living in the country and plan on taking several road trips a year.

However, one option for Expats who own a small car in Italy is to simply rent a larger car for road trips. This means that you can enjoy driving a larger, more expensive car for your road trips but benefit from the convenience of driving a small car in your everyday life at home.

The experience of driving a small car in Italy is very different from that of the United States . United States is a large country. An average American drives significantly more per year than an average Italian. There are a lot of medium/large cars, SUV’s, pick-up trucks and tractor trailers on the road.

But this is not the case in Italy. Italian roads are dominated by smaller vehicles and there are very few tractor trailers and other heavy duty vehicles on the road. You would “feel” much more safer in a smaller car in Italy than you would in the United States.

Is The Dealership Close By?

When you’re choosing which car to buy a car in Italy, it’s always worth considering where the nearest dealership is. The dealership will be your main point of call if anything goes wrong with your car and you need any parts replaced.

Fiat is the most widespread brand in Italy and all major towns and cities have a nearby dealership. This might partly account for the car’s massive popularity in the country, but it’s still something you should keep in mind.

Having the dealership close to you will mean that you get better customer service and can always drop by if you have any questions about registering for tax or other bureaucratic concerns you may have.

Is It Easy To Get Financing To Buy A New Car In Italy?

As an expat, getting a bank to finance your new car purchase in Italy is a little difficult for a few reasons.

Firstly, you will need to finance the purchase through an Italian bank account, something which you might only have just set up! Secondly, the paperwork can be very onerous and hard to wade through.

It’s traditional in Italy to buy cars with cash, or instant bank transfer, so the infrastructure for financing new car purchases is not as well established as it is in the US or other parts of Northern Europe.

If you need financing, I would first start with your bank in Italy or talk to the dealership. The dealership will have relationships with financial institutions.

An easier option would be to take out a person loan or get a line of credit in the United States. I got a personal loan in the US and purchased my property in Volterra. I applied for the loan, got it approved and received the money in my bank in less than 48 hours. This will never happen in Italy or for that matter in most other countries in the world.

Be Practical When Buying A New Car In Italy.

When you’re buying a new car in Italy it’s always a good idea to be pragmatic. You should be looking at getting a small, fuel-efficient car that has a low insurance cost and is well within your budget to buy upfront.

Learning to drive on the narrow, winding roads of Italy’s historic towns and cities will already take some getting used to! So to make this process as easy for yourself as possible, you should certainly consider the benefits of opting for a smaller vehicle.

Of course, for special occasions and road trips you can still rent a high-end luxury vehicle to really experience the Dolce Vita while touring through the fantastic scenery of rural Italy. However, for daily life as an Expat in Italy a Fiat Panda, Fiat 500 or a Lancia Ypsilon will serve you better than a larger model of car.

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