By on April 6, 2012

Brazil provides the first letter of BRIC. Without the BRICs, we’d have tombstones for carmakers. How are we keeping the global auto business alive, down here in the Southern Cone? Follow me as I give you the highlights.

According to the well-informed Auto Informe site, of the Brazilian Big 4, only Fiat grew (less than one percentage point) in the first trimester. VW and GM both fell more than 4%, while Ford dropped a little less. This must hurt, especially for GM as they are in the midst of their line-up change. The Cobalt, Cruze and S10 have all been launched. The factory could  have trouble ramping up the production, but GM must be worried that they are still not gaining traction. They must wonder how Fiat is doing it.

Brazil’s Automakers, Q1 2012

Brand Q1 2012 Q1 2011 Share Change
 Fiat 173,540 171,907 22.46% 0.94%
 VW 159,782 167,027 20.68% -4.33%
 GM 136,757 142740 17.70% -4.19%
 Ford 72,622 74,269 9.40% -2.21%
 Renault 52,325 38,338 6.77% 36.48%
 Nissan 27,307 13,396 3.53% 103.84%
 Honda 23,212 27,789 3.00% -16.47%
 Hyundai 21,516 25,095 2.78% -14.26%
 Toyota 21,165 22,019 2.74% -3.87%
 Citroën 16,426 22,367 2.13% -26.56%
 Peugeot 15,578 19,708 2.02% -20.95%
 Mitsubishi 12,095 11,552 1.57% 4.70%
 Kia 10,017 17,330 1.30% -42.19%
 Chery 5,057 2,591 0.65% 95.17%
 JAC 5,029 461 0.65%
 Hafei 3,175 3,618 0.41% -12.24%
Mercedes-Benz 2,175 2,931 0.28% -25.79%
 Land Rover 2,129 1,488 0.28% 43.07%
 BMW 1,888 2,136 0.24% -11.61%
 Suzuki 1,562 1,457 0.20% 7.20%
 Iveco 1,502 1,103 0.19% 36.17%
 Audi 1,056 752 0.14% 40.42%
 Jeep 904 513 0.12% 76.21%
 Dodge 785 671 0.10% 16.98%
 Ssangyong 775 1,123 0.10% -30.98%
 Volvo 758 763 0.10% -0.65%
 Lifan 588 692 0.08% -15.02%
 Mini 568 599 0.07% -5.17%
 Chana 479 0.06%
 Subaru 310 692 0.04% -55.20%
 Jinbei 303 129 0.04% 134.88%
 Chrysler 239 177 0.03% 35.02%
 Troller 237 356 0.03% -33.42%
 Smart 146 240 0.02% -39.16%
 Porsche 131 286 0.02% -54.19%
772,749 777,442 100.00% -0.60%

Indeed, Fiat Group has good news considering that the market has fallen by 0.6% (which basically means it’s stagnating) and competition is growing. Here, they’re doing the opposite of Europe and bringing new offerings to the market. Their new Palio, received with some doubts by some specialists, mainly because of sticker shock, has managed to get back in third place in sales. The all new Grand Siena is going on sale this month and will surely help the Italo-American maker. Chrysler’s brands are all up, though their sales are marginal, but they all help the bottom line. Even Fiat’s commercial truck brand, Iveco (though only LCVs are counted in this list), is up by more than 30%.

Another maker that is worried is Ford. While they dropped a little, they are seeing Renault and Nissan slowly creeping up on them. If one takes Renault-Nissan sales as a unit, they are now the fourth biggest in Brazil with combined sales of 10.3%. Renault grew by more than 30% and Nissan, riding on the success of both their new launches, March and Versa, has more than doubled sales.

Further down the ranking, Hyundai-Kia have seen their sales plummet. The new tax slapped onto imported cars has really hurt them. As Brazil and Mexico renegotiate their free trade agreement, all brands importing cars from Mexico are hurting. It now seems there will be quotas instead of free trade. Some makers are facing that by building factories in Brazil (like Nissan). Some makers have put plans on hold. However, this decision will surely hurt those dependent on Mexican production for sales in Brazil.

Of note, Chinese makers. While none of them have managed even a 1% share in our market, Chery and Jinbei (don’t ask me what that is, have never seen one and if I have, I didn’t notice) grew at around 100%. Even Chinese-owned Land Rover grew by almost 50% due to the strength of Evoque sales.

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13 Comments on “Who And What Is Moving In Brazil (Not Just To The Rhythm Of Samba)...”

  • avatar

    Any reason for Honda to fall by a similar amount to Hyundai?

    Nissan did well but most companies seem to have lost at least a few %, so I would assume GM’s isn’t too unhappy to still have a top 3 place in this market. Along with China they have a good position in at least 2 of the four BRIC countries.

    Is this a temporary stagnation with the Brazilian market or is it expected to plod along for sometime?

    • 0 avatar

      hi mike978.

      Honda fell ’cause they’re biggest seller in Brazil was being relaunched. Couple that with the decrease in sales of the older Civic with the tsunami in Japan (some parts are sourced there), and you have your explanation. However, after the Civic launch and normalizing of production, they should increase. Just a bit though ’cause they don’t have any offering in the A or B segment of our market.

      Hyundai fell due to the new tax annd their importer getting greedy on pricing. Note how Kia was hit even harder. The number one selling Kia has effectively been taxed out of the most competitive segment in the Brazilian market.

      Now, wish Bertel can put up the list of 100 most sold cars in March 2012. It would give a good idea of how really small the market is for most imported cars or even such B or C segment cars.

    • 0 avatar

      As to the stagnating market, most analysts are surprised. Most projected a growth of 3 to 5% this year. Pretty bad if you ask me.

      Now, I have an alternative explanation. Most don’t want to hear it, but I’m betting this situation is due to sticker shock. Couple the new tax and the fact that because of the new launches most makers have seized to opportunity to jack up prices. However, I expect to see some movement soon. Specially from Volks and even GM. Renault and Ford have been very agrressive on pricing (Fiat for some models too. Guess why the Uno took first from Gol? Well, for the first time Fiat has been putting cash on the Uno’s hood, it’s movig the metal, baby!). While that’s worked for Renault (and to a degree Nissan), for some reason it hasn’t for Ford (hint Ford, tired cars! New Fiesta way too damn expensive, free consulting over). Guess that, when makers start adjusting prices to the market reality, consumers will come back.

      Due to sticker shock, a lot of them have shied away.

      • 0 avatar

        Marcelo – thanks for the perspective, much appreciated. I note Bertel said GM was also changing some of their range, so it looks like both Honda and GM were affected by the same phenomenon (in part).

  • avatar

    Land Rover is Indian owned.

  • avatar

    true. sorry for the oversight! so, only russia out of the BRICs not in Brazil. And imagine, they were one of the first to get here when the market opened up. Sadly they didn’t stay long. If they had maybe they would’ve been in a better position to resist Renault’s take over (talking about Lada). But that’s anther story plus cojuncture…

  • avatar

    I read somewhere that Brazil finally mandated airbags in some (or all?) new vehicles manufactured. If true, that would cause some sticker shock. I have no idea what an air bag costs in Brazil, but they’re about $800 here to replace.
    The conditions of some of the roads in Paraiba, and the sheer volume of truck traffic, I think I’d want those exploding foam tombs that Sly Stallone uses in Demolition Man!)
    My friends in Brazil are very loyal to their brand: pretty evenly matched between VW, Fiat and Chevrolet. It’s good to see that kind of loyalty, given the history those 3 companies (along with Ford) have had in South America. Unlike Canadians, who are far too eager to defect to the flavor of the month, it seems Brazilians reward effort and long history.

    • 0 avatar

      Hi Carbiz!
      Well airbags and ABS will be mandotory only in 2014. There are loopholes in the law though and apparently the jurassic VW Kombi (Bus to you Americans) will use it to go on killing innocent Brazilians (tongue in cheek)!
      As of this year 2012, I think that makers must have an average of 25% of their cars with airbags and ABS. So, not really. My best bet is that the new tax came ‘local’ makers some room to breathe as well as the launches. So take the opportunity they did to squeeze out each and every last penny they get. As soon as a few months pass and the novelty wears off (not to mention the competition lowering prices to head off the new launches) things will come down to normal.
      As to loyalty, it ain’t so anymore. Maybe in the North of the country such attitudes live on, but in the southern part, we seem to be afflicted by the it factor as much as Americans. Rarely now do I see people buying another car from the maker of the car they had before. People have (a little) more money and are feeling bolder to go out and venture unto unknown territory.
      thanks for reading!

  • avatar

    Great post! I love reading news about Brazil as my in-laws work there (My wife’s aunt/uncle work for GM/”Volks”).

    Would love to do a new or used with you but from an “American in Brazil” perspective.

    I end up there a few times a year and with an infant, we need a safer car than the 1970’s Fusca that is currently passed around.

    The editors of TTAC should have my contact info.

  • avatar

    Land Rover is owned by Tata (of India), not the Chinese.

  • avatar

    Jinbei sells commercial vehicles only.

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