Let’s chat about one hurdle we faced when settling into our new Portuguese life – getting a car. Trust me, I’ve been there, and it’s quite the adventure!  We’ve now purchased two cars in Portugal (although we made it 2.5 years with just one and did fine!).  We bought the first car used with cash and the second we bought new through the dealership.

Maybe you’ve just made the big move to Portugal and are now wondering how to get around.  To be honest, we rented a car for our first eight weeks or so! Public transit is great and all, but let’s be real – having your own wheels gives you that sweet, sweet freedom to explore this gorgeous country (especially if you’ve got kiddos in tow). But hold onto your hats because buying a car here is a whole different ball game compared to back home.

You can definitely get by in Portugal without a car if you live in a larger city.  Most of the population doesn’t have a driver’s licence or own a car.  Several of my good friends, some with families, fall into this category.  It is not essential to be a car owner in Portugal.

However, coming from the USA where cars are part of our lives from 15 years old, you might want one.  We use ours nearly daily, but we could get to many places on foot.  We simply get lazy and want to save the time it takes to walk.  However, our Ukrainian family, who has lived with us for over 2 years, does not have a car and makes it work.

Uber and rideshare are plentiful and cheap in Lisbon. We use Uber to go downtown most of the time as parking can be a nightmare in Lisbon.  Many families simply supplement their regular walking and public transport with Ubers when they want to.

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Renting, Buying, Or Shipping? Oh My!

First things first. You’ve got to decide: do you want to rent, buy locally, or brave the waters of shipping your car from the US? Each option has its pros and cons, so let’s break it down.

Renting A Car: The Quick Fix

When we first landed in Portugal, we thought renting would be the perfect solution. No commitment, no paperwork headaches, just grab and go. And let me tell you, it was a lifesaver those first few weeks when we were juggling house hunting, school registrations, and trying to figure out where to buy groceries that resembled anything from back home.

But here’s the kicker – that convenience comes with a price tag that’ll make your eyes water. One expat friend told me, “Renting a car, especially an automatic, can cost you an arm and a leg in the long run. It’s okay for a bit, but not exactly wallet-friendly for the long haul.” And boy, was she right!

Rental terms are also not very long, two weeks at most.  This means you’ll be driving back to renew the contract (most likely at the airport) every couple of weeks.  Lame!  Poor Chris (my husband) handled this for us, and I was very grateful.

If you do decide to rent, here are a few tips:

• Book in advance for better rates.
• Consider local companies, and not just the big international chains.

Remember, renting is a great temporary solution while you get settled. It gives you time to understand the local car market, figure out what kind of vehicle suits your new Portuguese lifestyle, and save up for a down payment if you’re planning to buy.

Buying Locally: The Adventure Option

Buying a car in Portugal can save you some euros in the long run, but be prepared for a bit of a wild ride through the local car market and regulations. It’s daunting, sure, but also kind of exciting as you dive into life in your new home country.

Portugal is very much an “old boys club” in that business is driven through relationships and face-to-face meetings.  This seems antiquated to us Americans, but it’s just the truth.  You’ll get things done much faster if you know the right person or get the right introduction here.  Lawyers are fairly inexpensive compared to the US, so don’t be afraid to seek legal advice when purchasing a car.  A company like Movvinn can help also!. They’ve got legal help on staff and experts there to help expats at every stage.

Here’s what you can expect on this adventure:

1. The Language Barrier: First, brush up on your Portuguese car vocabulary. Words like “carta de condução” (driver’s license) and “livrete” (vehicle registration) will become your new best friends. Don’t be shy about asking for an English-speaking salesperson – most dealerships in expat-heavy areas have them.  Or make friends with a Portuguese person (most are extremely nice), and take them to lunch in exchange for helping you with translation.  
   
2. The Paperwork: Remember how getting your residence permit felt like a paper chase? Well, buying a car is like that, but with more grease stains. You’ll need your NIF, proof of address, and residency documents.
   
3. The Inspection: Used cars need to pass an inspection before changing hands. Don’t be surprised if the seller asks you to accompany them to the inspection center – it’s a great opportunity to practice your Portuguese small talk!
   
4. The Price Negotiation: Bargaining is an art form here. Don’t be afraid to channel your inner negotiator. Just remember, the Portuguese appreciation for a good deal is matched only by their disdain for rudeness. Keep it friendly!
   
5. The Insurance Hunt: You’ll need insurance before you can drive off on your new wheels. Shop around – prices can vary wildly, and some companies offer expat-friendly policies.
   
6. The Registration Waiting Game: Once you’ve bought the car, you’ll need to register it in your name. This can take a few weeks, during which you might feel like you’re in bureaucratic limbo. Perfect time to plan some road trips!
   
7. Don’t Expect To Drive Off The Lot.:While in the US we might be able to get a car in a matter of hours and drive it home the same day, that is NOT the case in Portugal.  License plates stay with the car and must be processed and ownership changed before you get the car.  Sometimes the dealerships also wait to do any work the car needs until a deposit has been paid (we put down 2000€ on our first car and then waited four more weeks to receive it).
   
8. Cars Are Expensive in Portugal: Due to taxes (VAT) and imports, vehicle prices are not cheap.  However, if you want to buy in another EU country, you’ll need to own the car in that country for six months, or you’ll face taxes and imports of 40% or more!  At first, we thought of buying a Mercedes to replace the Sprinter we had in the USA and going to Germany to get it!  However, we quickly changed direction once we realized we’d pay upwards of 30K to do this.   It’s pretty much impossible to buy a car outside of Portugal and bring it here unless you already have European residency and are moving to Portugal.

Bottom line: It’s a process like all administrative things in Portugal.  Before we moved here, someone told me getting paperwork done in Portugal is like going to the DMV in hell.  If I go with that mindset, things go better. Yes, there will be moments when you question your sanity. But in the end, you’ll have a car perfect for your new Portuguese life and a great story to tell at expat meetups.

Shipping From The Us: The Complicated Choice

Oh boy, shipping your car from the States to Portugal – it’s possible, but let me tell you, it’s not for the faint of heart (or light of wallet)! Let’s break down this wallet-draining adventure:

1. Shipping Costs: Depending on where you’re shipping from in the US and whether you choose container or RoRo (Roll-on/Roll-off) shipping, you’re looking at anywhere from $750 to $2,000 for East Coast ports, and $1,500 to $3,500 from the West Coast. And that’s just to get it on the boat!
   
2. Import Duty: Here’s where it gets really fun (and by fun, I mean expensive). You’ll pay 10% of the car’s value as import duty. So for a $20,000 car, that’s an extra $2,000 right off the bat.
   
3. VAT (Value Added Tax): Hold onto your hats, folks – VAT in Portugal is a whopping 23%! That’s calculated on the sum of your car’s value PLUS the shipping cost PLUS the import duty. Using our $20,000 car example, you’re looking at about $5,290 in VAT alone.
   
4. Vehicle Tax (ISV): This varies based on engine size and CO2 emissions, but for a typical mid-size car, you could be looking at anywhere from €2,500 to €8,000 ($2,700 to $8,700). Yikes!
   
5. Modification Costs: Remember, European cars are different from American ones. You might need to modify headlights, turn signals, or even the speedometer. This could run you anywhere from €500 to €2,000 ($550 to $2,200).
   
6. Registration and Inspection Fees: Budget around €200 to €400 ($220 to $440) for these necessary evils.

All in, for our hypothetical $20,000 car, you could be looking at total costs ranging from $12,000 to $20,000 or more, just to get it on Portuguese roads legally. And that doesn’t even account for potential issues with parts availability or servicing down the line.

I am in this American Expats Facebook Group, and there was one person who said, “Shipping our car from the US was more trouble than it was worth. The import taxes and modifications made it a nightmare. We ended up buying locally and couldn’t be happier.” After seeing these numbers, can you blame them?  We came to the same conclusion.

Navigating The Purchase Process: The Adventure Begins!

Requirements for Buying a Car as an Expat in Portugal

Alright, let’s talk about the nitty-gritty of what you’ll need to buy a car here in Portugal. Trust me, it’s a bit different from back home, and I want you to be prepared!

1. NIF (Número de Identificação Fiscal): This is your Portuguese tax identification number, and it’s absolutely crucial. You’ll need this for pretty much everything in Portugal, including buying a car. If you haven’t gotten one yet, make it your top priority!  An expat company can help you.
   
2. Proof of Address: You’ll need to show where you’re living. This could be a rental agreement, utility bill, or a certificate from your local Junta de Freguesia (parish council). 
   
3. Residency Permit or Visa: You’ll need to prove you’re legally residing in Portugal. This could be your residency card, visa, or certificate of registration from SEF (Serviço de Estrangeiros e Fronteiras).
   
4. Valid ID: Your passport will do the trick here. Make sure it’s not expired!
   
5. Driver’s License: Your US license is valid here (yay!), but you have an international driver’s license as well (this is simple to get in the US and costs just a few dollars).  Laws recently changed, and you no longer are required to convert your US driver’s licence to a Portugal one, which is really good news!  However, if you’re over 60, you may need to do this within two years of becoming a resident.  Consult a lawyer for up-to-date information.
   
6. Proof of Income: If you’re financing the car, you’ll need to show that you can afford the payments. This could be bank statements, pay stubs, or tax returns. We had to provide six months’ worth of bank statements when we financed our second car, as well as pay stubs and tax returns.  This got complicated as we are self-employed, but after lots of back and forth, we got it.  You’ll also need to have resided in Portugal for at least 90 days before considering financing a car.
   
7. Portuguese Bank Account: While not always strictly necessary, having a local bank account can make the process much smoother, especially if you’re financing. Plus, it’s super helpful for setting up automatic payments for insurance and road taxes.  We went with Novo Banco when we were applying for our residency, but other great banks include Millenium and Caixa Geral.
   
8. Car Insurance: You’ll need to have insurance before you can drive your new wheels. Some dealerships can help set this up, but it’s worth shopping around for the best deal.  We asked a friend for a reference on this or the dealership might have recommendations. Car insurance is very affordable in Portugal.  I think we pay around 300€ per year, but we don’t have any teenage drivers!  You have to be 18+ to drive in Portugal.
   
9. Money for Taxes and Fees: Be prepared to pay the Imposto Sobre Veículos (ISV) when registering your car, as well as the annual Imposto Único de Circulação (IUC). The amounts vary depending on the car’s age, engine size, and emissions.

Remember, requirements can vary slightly depending on your specific situation and the region of Portugal you’re in. It’s always a good idea to double-check with your local authorities or a reputable lawyer.

When we bought our first car here, I felt like I was running a paper-collecting marathon! But don’t let it overwhelm you. Take it one step at a time, and before you know it, you’ll be cruising down the beautiful Portuguese roads in your very own car.

Buying A New Car

Dealerships are your go-to for new cars. You’ll find big names like Renault, Peugeot, BMW, and Mercedes-Benz in most cities. The good news? They handle most of the paperwork. Even better, many have English-speaking staff in expat-heavy areas.

For online research, check out Auto SAPO, StandVirtual, and official manufacturer websites. It’s super helpful to do your homework in English before diving into potential language barriers at the dealership.

Consider joining the Automobile Club of Portugal (ACP). They offer car-buying services for members, which can be a lifesaver for us expats.

Buying a Used Car

You’ve got options here:

1. Dealerships: Many sell certified pre-owned cars. It’s similar to buying new, and they handle the paperwork.
   
2. Online Marketplaces: Sites like StandVirtual, and BCA are popular. Just be careful, and always see the car in person before buying.  OLX is known to be very scammy.
   
3. Private Sellers: You might find better deals, but you’ll have to handle all the paperwork yourself.

When buying used, always check for the registration certificate, recent inspection certificate, and service history records.

The buying process usually involves selecting the car, negotiating, paying a deposit, arranging insurance, completing ownership transfer paperwork, and registering the vehicle in your name.

As an expat, be prepared for this to take longer than you’d expect – sometimes up to two months! Make sure all your residency paperwork is in order, including your NIF and proof of address.  It’s always a good idea to make a local Portuguese friend, and ask that person for advice.  It’s a new world for us expats!

Financing can be tricky for new expats without a credit history here. Many of us end up paying cash or arranging financing through international banks.

One last tip: For used cars, consider getting an independent mechanic to check it out before you buy. The IPO (Inspecção Periódica Obrigatória) is like the Portuguese version of an MOT test, but an extra check can give you peace of mind.

Driver’s License And Insurance: The Final Stretch

Good news! Portugal now lets US citizens use their US driver’s licenses. But if you’re over 60, you’ll need to exchange it for a Portuguese one within two years of becoming a resident.

To start the conversion process, head to the IMT (Instituto da Mobilidade e dos Transportes). You’ll need a bunch of documents, including your US license, proof of residency, and a medical certificate. The process can take a few months, so be patient!

When you get your car, you’ll need insurance. They recently changed the law about displaying it on your windshield, but keep it in the car just like in the US.

Whew! That was a lot, right? But don’t worry – take it step by step, and before you know it, you’ll be cruising down Portuguese roads in your very own car. It might be a bit of a rollercoaster, but hey, that’s all part of the expat adventure!

Remember, requirements and procedures can change, so always double-check with official sources. And if you hit any bumps along the way, just remind yourself that every challenge is helping you grow and adapt to your new life here.

Good luck, and happy car hunting! If you have any questions or want to share your own car-buying experiences, drop them in the comments below. We’re all in this together!

Xoxo, Leslie

Additional Reading

Moving to Portugal Checklist

Understanding Electricity Charges and Providers in Portugal

Furnishing Your Family Home in Portugal – Where To Buy