Brazil’s auto industry accelerated in October, reaching the highest single-month sales volume since December 2014, helping to offset the downturn in exports generated by the crisis in the country’s top buyer, Argentina.
The result was obtained despite the uncertainties of the electoral period, which for the president of the association of automakers, Anfavea, Antonio Megale, indicates that the “consumer is determined to change their vehicles.”
In October, sales of new vehicles in the country totaled 254.7 thousand units, up 25.6 percent on the same month of 2017 and 19.4 percent in September. As a result, the sector has accumulated 2.1 million vehicles since January, up 15.3 percent from the same time last year, up from Anvafea’s forecast for the year, up 13.7 percent.
“Sales this year are expected to be above our projection for 2018. They should grow about 15 percent,” Megale said. “It seems that Brazil has entered a definitive growth path, people have lost the fear of being unemployed and this motivates sales. We see several sectors, besides agribusiness, recovering, and this contributes to economic growth,” he added, citing sales important for transportation application companies that are going through an expansion cycle.
If the official growth projection of 13.7 percent in sales is confirmed, the industry is expected to have the best year in 2018 since 2015, when it was still undergoing a period of licensing downturns, interrupted in 2017.
Leaving less than two months to the end of the year, Megale said that sales in early November, marked by two national holidays that reduce the licensing period, are proceeding at a fast pace, hitting at an early pace of about 11,000 units per day ante, which reached 11,600 in October.
The domestic market supported the production of automakers, which rose 17.8 percent in October compared to September and 5.2 percent year-on-year, to 263.3 thousand units. This was in spite of the 1.8 percent drop in vehicle exports in October from the previous month and 37.3 percent year-on-year.
Year-to-date vehicle production rose 9.9 percent year-on-year to 2.458 million units. Anfavea’s forecast is for the growth of 11.1 percent to 3 million units.
By 2019, the industry expects vehicle production to reach 3.2 million units in Brazil, despite the Argentine crisis, which accounts for about 70 percent of the country’s exports of vehicles. The expectation is based on the expectation that sales in the domestic market will increase by at least 10 percent.