Anfavea reports 3.1% increase in auto sales in May

Anfavea – National Association of Automobile Manufacturers – reported that Brazil´s automobile production grew 3.1% in May compared to April. The growth rate was, however, lower than that of the previous month.

Domestic sales grew 5.8% in May compared to April. Exports, however, recorded a 42.2% drop in the year, largely due to the economic crisis in Argentina.

Automakers in Brazil produced 275,700 new cars and trucks last month, while sales totaled 245,400 vehicles, according to Anfavea.

Anfavea’s president, Luiz Carlos Moraes, explains that despite the country’s lacklustre economic indicators, the industry’s positive results are due to a long process of recovery that initiated in 2017, after a drop of more than 40% in 2015-2016, at the peak of the crisis.

The following graph uses data from Anfavea to show production and exports of trucks and light vehicles between 2011 and April 2019:

“Our fall was well above the GDP´s 6.73% drop in those two years, so there is much to recoup to get back to 2012 levels. The domestic market in maintaining a good sales rate, with a 12.5% ​​cumulative increase in the year so far. Production has not kept up with this level due to a significant drop in exports to Argentina. The truck segment was the highlight of May, with its best month in sales since 2014. Fortunately, the market has been reacting steadily, and is expected to grow even more after the social security and tax reforms are approved, “Moraes believes.

The graph below shows exports of CKD trucks and light vehicles between January 2011 and May 2019:

Source: Reuters and Anfavea

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