The share of imports in the Brazilian car market has been steadily climbing this year and could reach 15% by year end – the highest since 1994.
Import growth is being underpinned by an appreciated local currency and steady market growth in Brazil.
Two countries are the biggest suppliers by volume: Argentina (65%) and Mexico (15%). In these cases, price advantage is significant, for bilateral trade accords free movement of products of these countries meaning that they avoid the 35% import tariff.
Mexico-made vehicles have been increasing their presence in Brazil since 2006.
Cars entering Brazil from Mexico include the PT Cruiser, Dodge Ram, Mazda 6-based Fusion, CR-V, Tiida, Sentra, Bora, Jetta, New Beetle and the Captiva.
Next month the Ford Edge crossover will be imported to Brazil from non-trade accorded, maximum import tariff Canada; from the US will come GM’s Chevrolet Malibu saloon in 2009. The Mexico-made Fusion and Captiva may make use of a ‘pricing balance equation’.
Also, commercial vehicles like the Ford Transit are now being imported from Turkey. Even highly taxed, there is a new and explosive market for vans. They are needed as to meet the new, severe restrictions on trucks in an expanded centre of São Paulo, the largest Brazilian city, whose total fleet nears 5m vehicles.
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Fernando Calmon
