The Brazilian association of vehicle manufacturers, ANFAVEA, has increased its sales forecast for 2007 to 2.2m vehicles, an increase of 14.5% over 2006.

The association had previously forecast a 7.7% gain, but it has revised its forecast because of a strong start to the year and improved credit offerings.

 "The results of the first quarter are based on increased income, economic stability, and dropping interest rates, which declined five percentage points when compared to last year.  The economic scenario, therefore, forced us to review the projections," said Rogélio Golfarb, president of Anfavea.

In the first three months of this year, 492,292 vehicles were sold, an increase of almost 18% on a year earlier. Passenger car and light commercial vehicles sales were up 18.5% in the first quarter to 468,652. In March alone light vehicles sales were up 24.1% to 183,742 units.

All vehicle manufacturers benefited from the first quarter sales growth. Fiat sales were up 25% to 119,000 vehicles. Volkswagen sales were up 17% to 110,700, and GM was up 25% to 99,700. Fourth ranking Ford sold 55,300 vehicles, an increase of 20% compared to the same period a year ago. 

The big four in Brazil are followed by Toyota with sales of 15,616 (+19%) and Pegueot with sales of 15,535, up just 6% on a year ago.

Truck sales were up 12.2% during the first three months. DaimlerChrysler leads the market with sales of 6,445 trucks, up 10.5% on a year earlier. Volkswagen ranked second with sales of 6,336, up 28.3%. Ford, third, sold 4,000 units during the period, an increase of 23% when compared to 2006.

Production forecast revised slightly up
ANFAVEA has revised its production forecast up from 2.71m units to 2.78m. This would represent an increase of 6.5% compared to the previous year.

High domestic demand is being offset by a decline in exports because of the increased value of the real.

In the first three months of the year production totaled 655,200 vehicles, an increase of 4% compared to the same period last year.  According to AutoData, capacity utilization is expected to be around 85% this year.

March production totalled 246,500 vehicles, an increase of 7.4% over the previous year.