Brazil: Vehicle production drops 15.8% in February

RIO DE JANEIRO, BRAZIL – Vehicle production dropped 15.8% in February, compared to the same month in 2021. According to the balance sheet released on Tuesday, March 8, in São Paulo, by the National Association of Automotive Vehicle Manufacturers (Anfavea), 165,900 units were assembled in February of this year. Compared to January, however, the number represents a 14.1% increase.

In February, new vehicle sales also suffered a 22.8% retraction compared to the same month last year. A total of 129,300 units were sold in the second month of 2022.

According to Anfavea’s president, Luis Carlos Moraes, the industry is still facing the difficulties that brought problems last year. “The number is in line with what we imagined, facing challenges by the [variant] omicron and the lack of components,” he justified.

AUTOMOBILES AND TRUCKS

The production of automobiles and light vehicles decreased 16.9% in February compared to the same month in 2021, manufacturing 152,600 units. Sales in this category shrank 24% compared to February last year, with 120,400 units sold.

The manufacture of trucks had a reduction of 3.5% in February compared to the same month in 2022, with 11,400 thousand units. Sales, however, were up 2.1%, with the sale of 7,900 thousand units.

EXPORTS AND EMPLOYMENT

Exports were up 25.4% in February compared to the same month in 2021, with the sale of 41,400 units abroad. According to Moraes, part of the increase in the month is due to cargo that could not be shipped in January and could only be sent to its destination in the following month. In the accumulated figures for January and February compared to the first two months of 2021, the result is still 17.3% higher, with the export of 69,100 vehicles.

In February, the number of jobs in the industry is 3.2% lower than in the same month last year, with 101,300 people employed.

UKRAINE

Moraes evaluated that it is still difficult to estimate the impacts of the war in Ukraine on the Brazilian automobile industry. “It is too early to put numbers that the impact of the war may have on Brazil or the automotive sector,” he pointed out.

However, he listed some risks that the armed conflict brings to the markets, such as high commodity prices and increased shortages of semiconductors produced by Ukraine and Russia, important palladium and neon gas producers. In addition, according to Moraes, the war can inflate the value of air and sea freight.

IMPACT OF THE IPI

Anfavea forecasts that the reduction in the Tax on Industrialized Products (IPI) rates, announced by the federal government at the end of last month, may reduce between 1.7% and 4.1% the final price of some vehicle categories.