The Lari Is the Hidden Price of Your Car

When a buyer in Georgia spots a listing at $12,000, that figure is the starting point of a longer calculation, not the end. The overwhelming majority of vehicles traded in Georgia's used-car market are sourced, auctioned, and shipped in US dollars. Freight contracts are denominated in dollars. Even the informal negotiating floor between importer and buyer often uses a dollar handle. But the moment a car touches Georgian customs, the currency switches to lari — and the lari cost of a car is shaped by two forces that have moved sharply in opposite directions over the past few months.

The exchange rate is cooperating. The clearance regime is not.

A realistic landed cost builds up in layers. Start with the auction purchase price, add ocean or overland freight, then add port and brokerage charges — all still in dollars. The next line item is where lari enters: customs clearance, which in Georgia is calculated on engine displacement and vehicle age, and is collected entirely in lari. Excise is a fixed GEL-per-cc charge that genuinely does not move with the exchange rate — but VAT and any ad-valorem import duty are assessed on the customs value converted into lari at the declaration-date rate, so they do move with FX, partly trimming the appreciation benefit on the dollar layers. Finally, the buyer converts all of it into a single GEL ticket — or, if financing, pays GEL monthly installments priced off a policy rate that just moved higher for the first time in four years.

This layered structure means that "3.7% lari appreciation" and "median GEL clearance cost of 3,068" are not comparable numbers. The FX tailwind shaves a percentage off the dollar-denominated layers. The clearance bill is a hard GEL line item that sits on top regardless.

The lari has strengthened meaningfully since mid-March. From a year-to-date peak of 2.740 on 2026-03-10, the rate has moved to 2.641 as of 2026-06-22 — roughly 3.7% lari appreciation in about three months. Year-on-year the lari is approximately 3% stronger. The year-to-date average rate of 2.694 means buyers who purchased earlier in the year paid a slightly higher effective GEL equivalent on their dollar costs.

For a car priced at the active-listing median of $12,000, the shift from 2.740 to 2.641 trims roughly 1,188 GEL off the GEL equivalent of the sticker. That is not nothing. Cash buyers with dollar savings benefit in full — every GEL of appreciation lands directly in their pocket on conversion. The NBG's rate hike to 8.25% in May 2026, its first tightening move in four years, signals that the central bank is defending lari stability against inflation running at 5.7% year-on-year as of May. Transport prices are up 15.1% YoY, which is the category most directly linked to car costs. A stable or firming lari is thus a deliberate policy outcome, not an accident.

The FX tailwind is most useful to a specific buyer profile: one who holds dollar savings, is purchasing in cash, and is buying a newer or smaller-engine vehicle where the excise is lower. For that buyer, converting dollars at 2.641 rather than 2.740 is a genuine saving, and the reduced clearance cost on a sub-1.6L or a hybrid amplifies the effect.

Financed buyers receive a diluted benefit. The NBG's 8.25% policy rate feeds into GEL lending rates, keeping auto-loan costs elevated. The monthly GEL payment on a lari-denominated loan absorbs any FX gain and then some. Meanwhile, buyers targeting larger-displacement or older vehicles face the 4.5 GEL/cc excise rate, where the math shifts decisively against them regardless of the exchange rate. The transport CPI reading of +15.1% year-on-year confirms that the aggregate cost of car ownership in Georgia has moved upward; the lari's strength is one favorable input into a broadly expensive equation.