The Automotive Industry in Cyprus

Cyprus is one of the smallest automotive markets in the European Union and has no vehicle production or significant supplier industry . Nevertheless, the sector is gaining importance – particularly due to the growing market for electromobility, digitalization, logistics services, and mobility concepts. The country’s location in the eastern Mediterranean also offers potential for specialized automotive services and regional re-exports

1. Significance for the Cypriot economy

The automotive industry does not play a classic industrial role in Cyprus, but it has economic significance in the form of:

• Vehicle sales and import

• Service and workshops

• Logistics and re-export of vehicles

• Development of the electromobility infrastructure

• Use of renewable energies in the mobility sector

• Mobility services (ride-sharing, rental, tourism transport)

Since Cyprus does not have its own OEM, the market is entirely import-oriented.

2. Structure of the automotive industry in Cyprus

1. Import and trading companies

The Cypriot vehicle market is entirely based on importers. The main areas are:

• • New and used car import

  • Re-export of vehicles to the Middle East and North Africa

  • Leasing and car rental companies (important for tourism)

  • Workshops, spare parts and aftermarket

Tourism creates an exceptionally large car rental market relative to the population.

2. Electromobility and new drive systems

Cyprus is in an early but dynamically growing phase of e-mobility:

• • Rising sales of electric and hybrid vehicles

  • Government funding programs for electric cars

  • Expansion of the charging infrastructure

  • Integration of renewable energies (especially solar power)

Cyprus has a very high solar potential due to its climate, which favors e-mobility.

3. Logistics & Maritime Vehicle Handling

Cyprus is an important location for re-export and transit business:

• • The ports of Limassol and Larnaca serve as hubs for vehicle logistics towards the Levant, Gulf States and North Africa.

  • Shipping companies use Cyprus as a transshipment point for vehicles and construction machinery.

4. Mobility Services

The economy is strongly service-oriented, which is why the following segments are growing rapidly:

• • Carsharing & E-Scooters

  • Digital mobility platforms

  • Rental Car Fleets with Electric Vehicles

  • intelligent transport systems in major cities

3. Technological priorities and future fields

Cyprus’ automotive market is experiencing several future trends due to structural changes:

1. Electrification of transport

Cyprus is investing heavily in:

• • Charging points in urban areas

  • Fast charging stations along the main roads

  • Funding programs for private households and businesses

  • Electrification of government vehicle fleets

2. Integration of renewable energies

The high solar radiation makes it possible to:

• • Self-consumption solutions for charging infrastructure

  • Green energy for the transport sector

  • Pilot projects for solar charging stations

3. Digitalization & Smart Mobility

Cyprus is expanding smart transport and mobility solutions:

• • Traffic management systems

  • Digital ticketing and mobility platforms

  • Connected vehicle services

  • Smart parking systems

4. Labor market & education

Since automobile production is lacking, the labor market focuses on:

• Vehicle Repair & Maintenance

• Trading and Logistics Activities

• IT & Digital Mobility Services

• Electrical Engineering for Charging Infrastructure

Universities in Nicosia, Limassol and Larnaca are promoting research in electrical engineering, computer science and renewable energies – fields that are crucial for the mobility of the future

5. Challenges

1. Completely import-based car market

High costs, dependence on international supply chains, fluctuating vehicle prices

2. Limited industrial value creation

No OEMs, no large suppliers – value creation occurs almost exclusively in trade and services.

3. Infrastructure under construction

Especially at:

• • charging points

  • public transport

  • digital transport networks

4. High vehicle prices

As an island market, transport costs and duties are higher than the EU average

6. Opportunities and prospects

1. Strong expansion of electromobility

Cyprus can become a pioneer in the Mediterranean region:

• • Low solar costs

  • Government investment

  • Increasing demand

2. Tourism as an engine of innovation

Large rental car fleets can be quickly converted to electric vehicles.

3. Logistics hub in the Mediterranean

Ideal for vehicle handling and re-export markets in the region.

4. Growth of digital mobility services

The IT and startup scene is growing, especially in Nicosia and Limassol.

Our conclusion:

Cyprus may not be a production country, but it is a growing mobility market with clear future profiles:

• Electromobility

• Logistics services

• Digital mobility platforms

• Integration of renewable energies into the transport sector

The island nation is increasingly developing into an innovative, export-oriented service center in the field of modern mobility – ideally positioned between the EU, the Middle East and Africa.