Brazil’s Auto Industry May Suffer Due to Neighbor’s Economic Crisis
By Lise Alves, Senior Contributing Reporter
RIO DE JANEIRO, BRAZIL – Brazil’s vehicles exports this year may suffer due to the economic crisis in Argentina, according to Brazil’s National Association of Automobile Manufacturers.
“Unfortunately, this year, vehicle exports will not register the best news,” Antonio Carlos Botelho Megale, president of the National Association of Automobile Manufacturers (Anfavea), said this week.
“Our main problem is our main partner, Argentina, which unfortunately is in a very difficult (economic) situation,” added the Anfavea official.
According to Megale, the Argentine market is expected to be very weak this year and Brazilian automakers are looking to other countries to export their vehicles.
“We are making an important effort to send vehicles to other countries like Colombia, Chile and Uruguay. We are looking for new markets outside Latin America as well,” Megale stated.
The substitution, however, may take time. “The Argentine market is the second largest market in South America. So, when it retracts, we, its biggest suppliers, feel,” said the official.
According to Anfavea, Brazil’s auto exports sales reached US$876 million in February. For the first two months of the year sales totaled R$1.6 billion, down by 36 percent from the results registered last year during the same period.
The news, however, is not all bad. In February, vehicle production in Brazil grew by 29.9 percent in comparison to January and 20.5 percent in comparison with the same month of the previous year. The increase in production is due to the increase in auto sales in the domestic market.
“There is a more optimistic mood; people are more confident in maintaining their jobs and there is an overall perception that the country is growing again,” concluded Megale.
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