Only two automakers – Fiat and Renault – are organised in Brazil as PLC companies and therefore obligated by law to issue financial results yearly. The others are LLC companies with balance sheets consolidated by parent companies and are published at a regional level only.
Last year Ford and GM reported losses in South America but estimates are that the negative results in the country are likely to be around 50% of the total.
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Fiat, the Brazilian market leader in both cars and light commercials for over a decade, managed to achieve profit before taxes of BRL300m/US$135m last year but that was 81% lower than in 2012.
Fiat blamed the result on growing domestic competition and inflationary pressure on costs.
Last year, the company reached an agreement with the federal consumer protection body and paid a BRL3m/$1.3m fine related to a late 2010 recall campaign on the Stilo rear wheel that cold become detached.
It also produced a video clip costing BRL250,000/$112,000 aimed at alert consumers to the importance of responding to recalls.
In the last 10 years, recall campaigns in Brazil tripled to 109 from 33 and in 2013 61% were for cars and 14% for motorcycles. Some 40% were for Brazilian-made products and the rest for foreign imports.
Volkswagen, Toyota, and Group CAOA-Hyundai have also have paid fines for late recall reporting.
