Automobile production in Brazil may have doubled last month after a sharp drop in previous months but was still well below its highs of a year ago, industry figures showed.


National automakers’ association Anfavea said last month’s output of 186,000 units was up 92.7% month on month but 27% lower year on year as consumer caution – and a lack of credit – kept new vehicle registrations virtually flat.


January sales rose 1.5% month on month to 197,500 vehicles but were off 8.1% year on year. Exports were down 53.7% month on month or 61.6% year on year as just 17,700 were shipped, Agence France-Presse reported.


January registrations of imported cars surged 45% versus December while those for cars made in Brazil remained practically unchanged. Imports took 20% of market share in January.


Anfavea president Jackson Schneider told AFP the rise in imports was “not the start of a trend… it principally has to do with the value of the dollar and reducing stocks.”

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Although the dollar had risen around 30% against Brazil’s real since September, many of the imported cars had been in stock and sold at the previous, lower price, he said, adding that the January turnaround was in part a reaction to the “brutal” production cut effected in December.


Production for 2008 was a record 3.21m vehicles but well below the 3.42m Anfavea target set before the credit crisis hit last September.


December 2008 production fell a stunning 54% and sales 47%, compared to November 2008 after Ford, Fiat, Volkswagen and other major carmakers building in Brazil put tens of thousands of auto workers on forced holidays in the year’s final months to cut back on production and attempt to deplete unsold inventory. General Motors Brazil also sacked 800 factory workers.


Brazil’s government, fearful of mass lay-offs and the effects of the crisis on the all-important auto industry, has provided $3.5bn in aid to the sector, mostly aimed at encouraging consumer car loans, AFP noted.