In September, the Brazilian market reached an average of 10,738 units sold daily, nothing short of 35% up year on year. For the year to date, another all-time record: 1.739m vehicles, 27% up on the first nine months of 2006.
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Both daily average and year to date production have also set new records: 13,305 and 2.182m units, respectively.
These amazing numbers have forced motor industry trade group Anfavea to review, for the third time in less than a year, the estimates for 2007. It now predicts domestic sales in the 2.4m to 2.45m range while production is to expected to top 3m.
A huge amount of financing at lower interest rates, high consumer confidence and increased purchasing power help explain these results.
But no one could even dream about this level just a year ago, at every industry event just-auto attended.
The one-litre base models, which accounted for almost 80% of total auto sales in 2001 dropped to just 52% in September.
Even burdened by the unfavourably strong currency, exports are 5% up, reaching $US9.5bn by the end of September. In unit numbers, however, there was an 8% slump to a little less than 600,000. CKD kit exports for assembly overseas were most affected (24% down) due to lower profitability.
Nonetheless, it was necessary to divert part of what would normally be export production to meet the needs of a very hot local market.
Anfavea has not reviewed its export forecast for 2007: it expects zero-growth in value on an 11% drop in CBU and CKD units combined.
To handle this unexpected scenario, most automakers are working overtime. In some cases, more than half of this year’s Saturdays were contracted with the workers, including retirees, who do not need any training.
Volkswagen Trucks and Buses has been paying extra-promptly for extra Saturday work as a way of luring its workers in on the weekend yet delivery of its heavy trucks – which, by the way, have just started SKD assembly in right-hand drive South Africa – takes six months at home in Brazil.
Fernando Calmon
