By on June 3, 2010

The first numbers are out for May. Sales of new cars dropped 9.66 percent in relation to April. Why? This is the first month in which the full effect of the end of the incentive program was felt. Many dealers however kept up incentive pricing avoiding the 20% drop I had predicted. All is not lost though.

The Brazilians have not forsaken their cars. Comparing May 2010 to May 2009, there was actually a gain of 1.64 percent! For the first five months, Brazilian car sales were 1,316,824 vehicles, up 14.26 percent over the same period in 2009, reports Brazil’s second largest newspaper O Estado de S. Paulo, citing Fenabrave (Brazilian Distributors Federation). So, the year is still on track for setting the best-ever sales record.

The first numbers for May also reveal some surprises in terms of brands. Fiat still tops the charts at 23.31 percent, with VW right behind them at 23.02 percent of the market. It seems like the new Uno is still not gaining conquest sales from VeeDub. General Motors dropped slightly to a 19.74 percent share, while Ford had a bad month with a participation of only 8.48 percent (the new old Fiesta is, for now, a flop).

Hyundai though is creating quite a stir. They leap-frogged Renault, Toyota, Honda and the PSA twin and captured fifth place! In numbers, they got 3.72 percent of total sales.

As for the first five months of the year, no changes yet, though Hyundai’s strong showing in May means that the fifth spot will be hotly contested. Maybe even Ford will feel the heat. Anyway, Fiat leads by a hair with 22.54 percent, Volkswagen is breathing down their necks with 20.94 percent, and General Motors seems stuck in third with 20.28 percent. Ford is far from the leaders at 10.39 percent while Renault is holding on for dear life at fifth with 4.39 percent.

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7 Comments on “Brazil In May: Sales Slide 9.66 Percent. Or Gain 1.64...”

  • avatar

    I was just talking with my wife’s cousin outside of Sao Paulo yesterday on IM and she just bought a Chevy Corsa (her first new car).

    Outside of Chevy & Volkswagen (fiat?), are there any other locally produced major marks made in Brazil? According to all my in-laws there, Honda, Hyundai, Toyota, Subaru, etc. are basically only for the very rich due to massive import taxes. Has this changed at all?

    Does the increase in Hyundai sales point to a growing quantity of upper class Brazilians?

    • 0 avatar

      Hello Robstar,

      The first guys in Brazil were Ford, more than 80 years ago,who built an assembly place in São Paulo city to build CKD Ford Ts. Then GM got in on the act and have been here at least 75 years and were the first to produce what should be considered the first Brazilian car (one of their beautiful pickups from the 50s had a beautiful “Brazil” edition) since most parts were locally sourced.
      But the real owners of the title goes to VW and their Beetle, which became, for a long while, the quintenscencial (sp?) Brazilian car. Following a government incentive program launched the Beetle in the late 50s or early 60s (though VW’s first car in Brazil was the Bus).

      After that era imports were essentially forbidden and Ford, GM, VW, VKW-Vemag, Chrysler and Simca, Alfa Romeo and FNM, Willys-Overland not to mention the Brazilian brand Gurgel and a variety of small volume specially sport cars like Puma were produced locally. All had factories and produced in Brazil. Over time Ford took over Willys, VW took over Chrysler and Simca, Ford and VW picked the spoils after the ruin of VKW-Vemag (that disappeared in Germany but was doing well locally). All the Brazilian brands went under after a while, though Gurgel lasted well into the 90s.

      The only change in this scenario from thr 50s to the 90s was Fiat coming over in 1975. The state of Minas Gerais did a joint venture with them and against all opposition from the powerful state of São Paulo (who by then concentrated all survivors GM, Ford, VW and Chrysler which was hanging on for dear life and was soon put out of its misery by VW) financed what is reportedly the world’s second largest factory, Fiat’s in Betim. During this process they absorved Alfa Romeo’s (and FNM’s) operations in Brazil (and shut down the brand, sniff!).

      Then in the 90s, the market was put wide open. Everybody set up shop (import shops). From Lada to Suzuki (who didn’t make it), from the French (who eventually went on to produce locally) to Hyundai (who has been “threatening” to produce locally since at least the early 90s), not to mention the German übber brands and Italian and British sports and lux car makers. Later in the 00s the Indians (in the form of Mahindra) and Chinese have arrived.

      As to factories (and if memory serves well), Ford has 2 (in São Paulo and Camaçari, Bahia), VW has 3 (cars in S. Paulo and S. José dos Pinhais, Paraná and an engine factory in São Carlos, S. Paulo state), GM has two or three (São Caetano and São Paulo (not sure) and Gravataí, Rio Grande do Sul), Fiat two (in Betim, Minas Gerais and an engine factory in Paraná – Tritec – ex BMW-Cheysler joint venture), Renault one in Paraná, Peugeot/Citroen one in Porto Real, Rio de Janeiro state, Mitsubishi has a mostly imported parts assembly line in Catalão, Goiás and makes pickups that have been discontinued elsewhere, Mercedes-Benz has a huge white elephant in Juiz de Fora, Minas Gerais with a token workforce producing CKD-drawback cars (in order not to pay the fines they would owe the State were they to shut down the mess), and Toyota and Honda each have limited production (small) factories in the countryside of S. Paulo state. Coming soon, though I’ll believe them when I see it (Hyundai’s propaganda and corporate communication is a little, shall we say, euphemistic in Brazil), Hyundai has a factory in Goiás similar to Mitsubishi’s (discontinued cars elsewhere) and is supposedly building a factory of their own in the S.Paulo countryside, too.

      So that’s it, to sum it up.

  • avatar

    AFAIK Honda and Toyota have factories there. I don’t know if Hyundai, but if they’re climbing the charts, it is possible.

    Toyota also has a factory in Argentina, and Honda in working on one. If I’m not wrong, those cars can enter Brazil without high tariffs due to Mercosur agreements.

    Of course, it’s Marcelo who should confirm or correct. Glad to read from you again.

    • 0 avatar

      Stingray, as usuall you are correct. Due to Mercosur, Ford imports the Ranger and Focus from Argentina, VW the Amarok, Toyota the Hilux. AFAIK Honda’s plant in Argentina has been suspended. Not to mention some Chinese cars brought in as EFFA (from a CKD assembly line in Uruguay) I thinh they are Chanqua (???).

      Other cars imported without high tariffs come from Mexico (due to the free trade agreement), Ford the Fusion, Chevy the Malibu, VW the new Beeetle, Jetta, Bora, Nissan the Tiida (or Versa??), Chrysler the PT Cruiser probably among others I forget.

      Outside this universe anybody who wants to import cars to the country can. And imported cars pay 35% tarrif.

    • 0 avatar

      I read that Chery was the one being installed in Uruguay

    • 0 avatar

      Chery, aqgain, as far as I know, is doing the rounds, romancinzing the various governments (Argentina, Brazil and Uruguay not to mention Brazilian state governments, who also have the financial werewithal) to see who gives them more.

      As to a CKD line in Uruguay, they may as well have one. I did hear of something like that. Don’t know if they went ahead with it thoug, as both Argentina and Brazil strongly oppose this kind of assembly in Mercosur. Uruguay accepts it, but must resist the pressure from its (much) stronger partners.

  • avatar

    There’s also Nissan, which makes Frontier trucks and Livinas in Parana, along with Renault.

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