Katrina-ravaged cars being sold in Bolivia

updated 2:48 p.m. ET Nov. 17, 2007

COCHABAMBA, Bolivia - The bathtub ring of mold on the ceiling of Colleen McGaw’s Mini Cooper marks how high Hurricane Katrina’s floodwaters rose inside the sporty red coupe.

“There was this mold, this grossness all over it,” McGaw says, recalling how she found the car, her college graduation present, three months after the storm submerged her New Orleans neighborhood. “I cried. It may sound lame, but I cried. I had wanted a car like that since I was a child.”

Two years later, McGaw was shocked to learn from The Associated Press that her beloved Mini turned up 3,600 miles south in Bolivia. Its new owner — stuck with a complete overhaul at $23,000 and counting — is feeling her pain.

Tens of thousands of cars were damaged or destroyed by Katrina, which submerged much of New Orleans in a corrosive broth of saltwater and mud. U.S. officials warned Americans to beware of buying the drowned cars.

But many “Autos Katrina” were shipped overseas, often sold through Internet salvage auctions now globalizing the auto recycling industry.

Totaled cars used to be sold mostly at local auctions to scrap metal dealers and serious gearheads, who well understood the risks of the trade. But in the past five years, an explosion in online sales has lured shoppers around the world. It’s a “Wild West marketplace” of tainted dream cars at rockbottom prices, says U.S. auto insurance industry analyst Brian Sullivan.

“Information is in short supply, and you have to be smart and know what you’re doing,” he says.

Agency: 10,000 Katrina cars in Bolivia
Suspected Katrina cars — with their jittery wiring, sand in the cracks and the telltale mildewed stink — have cropped up in a number of countries, but Bolivia has become a particular target. One local environmental agency believes 10,000 or more flooded U.S. cars may have ended up in the landlocked nation, drawn by loose import rules, a thriving smugglers’ economy and an insatiable hunger for cheap wheels.

The hurricane relics are part of a deluge of used imports rapidly transforming South America’s poorest country. Fueled by money sent home by migrants abroad, the number of vehicles on Bolivia’s few paved highways is expected to double in the next five years.

McGaw’s Mini is still a long way from joining the traffic jam.

Hauled south on a container ship, imported through the Chilean port of Iquique and trucked over the mountains to this Andean valley city, the coupe is now perched on a hydraulic lift, stripped to its chassis and surrounded by its rusty innards.

The new owner — worried that publicity will reduce the car’s resale value and perhaps smarting from automotive heartbreak — declined, through his mechanic Ramiro Sanchez, to be identified or interviewed.

“He’s totally demoralized, but he doesn’t just want to give up on it, either,” Sanchez says.

Car ravaged by Katrina
The Mini’s odyssey began as the McGaw family fled New Orleans on Aug. 28, 2005, the day before Katrina made landfall.

Colleen McGraw via AP file Colleen McGaw, right, and her sister, Katie, stand beside a brand new red Mini Cooper given to Colleen by her parents as a college graduation gift. A year after this picture was taken, Hurricane Katrina hit New Orleans, breaking levees and flooding 80 percent of the city. The car, which was parked at the McGaw family home in the city's Lakeview neighborhood, was submerged in 8 feet of floodwater.

“I just started packing random things — a cocktail dress, shorts from the 7th grade,” says McGaw, who has since finished a law degree and clerks for the Orleans Parish District Court. “I didn’t think it was going to flood.”

McGaw left her 2004 “chili red” Mini in a backyard carport and rode out of town with her parents.

The next morning, Lake Pontchartrain’s storm surge burst through the 17th Street Canal levee, flooding their Lakeview neighborhood in eight feet of water and completely submerging the Mini.

When McGaw finally saw her car again three months later, it was dry but coated in salt and slime. A beer can had floated in through the broken windows.

McGaw’s insurer, Geico, left a check for $18,500 and towed the car away. A vehicle history report listing the Mini as a total loss names the insurer as the car’s final owner.

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