August Vehicle Sales in Brazil Slump Slightly, but Production Increases

RIO DE JANEIRO, BRAZIL – The sale of vehicles in the country fell by 0.3 percent in August compared to July, from 243,600 units to 243,000. Compared to August of last year, when 248,600 units were sold, there was also a 2.3 percent drop.

In the accumulated period for the year, an increase of 9.9 percent was recorded, with 1.79 million vehicles sold. The data were released yesterday, September 5th, by the National Association of Motor Vehicle Manufacturers (ANFAVEA), which assigns the month’s decline to the lower number of working days.

The president of ANFAVEA, Luiz Carlos Moraes, believes that sales are expected to increase by approximately 11 percent in the year, in view of the sales so far. In his opinion, the second semester is typically a better period than the first, and this year it is associated with other factors.

“The reduction of the SELIC tax is being applied to financing, the CDC (Consumer Direct Credit), which is the main financing tool, has an annual 20 percent rate, and the banks are eager to offer more credit while defaults are under control. It will not be a large increase, but it will be better than the first semester,” he said.

Export

Exports of assembled vehicles fell by 12.8 percent from July to August. In the eighth month of the year, 36,700 units were sold while in July these totaled 42,100. When compared to August last year, the drop was 34.6 percent, and a 37.9 percent retraction in the year to date, compared to the same period last year.

“We have been worried about these numbers since the start of the year. We have been reporting that our sector’s dependence on the Argentine market is very high, with 70 percent of our exports going to Argentina, a country which has been experiencing a crisis since the beginning of the year, with an election now, going through a delicate moment. They truly are a challenge for the sector and we do not see a solution that could have a positive impact in the short term,” Moraes said.

Production

According to ANFAVEA, vehicle production in August was 269,800 units, 1.1 percent more than in July, which was 267,000. Compared to August last year, there was a 7.3 percent drop. In the year cumulative production increased by two percent.

“We should not adjust production to the Argentine scenario because it (production) has been adjusted since the beginning of the year according to each facility. Each assembler is adjusting its production according to its product, its volume,” he said.