"We have sold 38 Hyundais already, but no coupes. They are considered too flashy in these circumstances," said Nihad Abd Al-Rahman, assistant general manager of al-Kasid, exclusive agents for selling Hyundai Motor Company cars in Iraq.

   

"Iraqis are looking for something affordable and reliable, and Hyundai fits the bill," he said after selling a $10,200 Elantra to a retired officer.

   

The two-storey showroom near the elegant German embassy has models ranging from the $7,200 compact four-door Getz to the $17,500 140-horsepower Coupe.

  

The timing for opening a new glass-fronted showroom filled with new cars may seem odd. Bombs have destroyed several buildings in the area in the past few months and residents say theft and hijackings have been on the increase.

 

Virgin market

   

But Abd Al-Rahman said his trading company could not wait to enter a virgin market and take advantage of an environment car dealers consider heavenly - if it was not for the bombs.

   

Petrol costs about one cent a litre in Iraq. There is no income tax in force and government attempts to impose a 5% tariff on imports have repeatedly failed.

   

"We are merchants and part of our profession is taking risks. The country is still in a war mode, but at least Iraqis have choice," Abd Al-Rahman said.

   

Iraq has had no official car dealerships since Chevrolet packed up and left as the Baath Party came to power in 1968. The state acquired a monopoly on importing new cars. Showrooms were banned and sales were conducted from state warehouses.

 

"We are merchants and part of our profession is taking risks"

Nihad Abd Al-Rahman,
assistant general manager,      al-Kasid, Baghdad

Saddam Hussein's Iraq preferred to deal with countries it considered allies, although not particularly renowned as leaders in the car industry, such as Russia. But government officials and Saddam's entourage were treated far better.

   

Iraq's borders opened after the war and restrictions were effectively scrapped on importing cars. Hundreds of thousands of cars entered the country, but they were overwhelmingly second hand. A 1990 BMW 335i cost around $5500.

 

Promising

   

Abd Al-Rahman said Iraq's used car market would remain huge, given an increase in income after the end of the crippling 1990-2003 economic embargo.

   

"The new car market remains promising," he said. "Our prices are among the cheapest in the world and we offer a one-year warranty and a service centre. This was unheard of."

   

Workers were fitting steel bars to the showroom's windows. "We prefer straight glass to see the cars. But the situation is not reassuring. We hired extra guards," he said.

   

The dealership has no insurance - none exists in postwar Iraq - and keeps the location of its warehouses secret for fear of looting.

   

But Khalaf Janabi, the retired officer who bought the Elantra, was happy with his new set of wheels.

   

"I have not had a new car since the 1960s," he said.