Credit limitations do not hamper industry growth driven by exports, say Brazilian automakers

With factories at a standstill and employees on mandatory collective vacation, representatives of Brazilian automakers met on March 22 with Minister of Finances Fernando Haddad. Despite the challenging scenario involving high production costs and more expensive credit, manufacturers say that the semiconductor shortage crisis is in the past, and they bet on industry growth driven by an expansion of export results.

The president of the Anfavea industry association, Márcio Lima Leite, said that he “would like to see” a reduction in the staple interest rate, even though, admittedly, determining it is not up to the sector. The meeting’s goal was to present an overview of the industry and discuss measures that could reduce production costs and facilitate exports.

“Brazil went from a production crisis, caused by the lack of semiconductors, to a year that has begun with signs of strong demand,” he observed. “Right now, we are working hard with a focus on exports and developing synergy and regulatory convergence with other countries.”

According to the director, the rise in interest rates impacts the internal market and has led to the aging of the national car fleet.

“Two and a half years ago, 70% of deals were closed in credit and 30% in cash. This month, the situation reversed – 70% in cash and 30% in credit. This means that this consumer has vanished and is going to a used market,” he explained.

Despite the shutdown, the president of Anfavea does not think massive layoffs will be necessary for the short term.

“We have a huge opportunity for growth with exports and the local market. The issue with semiconductors limited our growth, but the crisis is getting behind us,” he added.

At the hearing, Leite and other executives from the sector discussed tax reform and pledged their support to legislation changes.

Source: Valor Econômico

To read the full original article, please visit: https://valor.globo.com/brasil/noticia/2023/03/22/montadoras-esperam-crescimento-apesar-de-credito-mais-caro-com-aumento-de-exportacoes.ghtml

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