MercoPress. South Atlantic News Agency

Brazil’s March sales of cars rose 11.6% but fell 14.4% from a year earlier

Carnival festivities even influence car sales

Sales of new cars and light commercial vehicles rose 11.6% in March from February, Brazil's Federation of Vehicle Distributors, Fenabrave, said on Friday, but they fell sharply from a year ago.

Fenabrave said 288,758 vehicles were registered last month, compared with 337,381 units in March of 2010, a fall of 14.4%. The dramatic swing in numbers was due in part to one-time calendar effects, as Brazil's long carnival holiday fell in March this year instead of in February, meaning showrooms were open for fewer days than in March last year.

Sales in March of last year were also boosted by consumers' rush to buy new cars before expiry of a tax break that was designed to support sales during the global financial crisis.

Brazil is a key market for some of the world's biggest automakers: Italy's Fiat SpA, Germany's Volkswagen AG), US-based General Motors Co and Ford Motor Co.

Newer entrants including Korea's Kia and Hyundai have fast-gained popularity while a number of lesser-known Chinese makes have recently entered the market.

Brazil's economy is estimated to have grown 7.5% last year. That increased income together with easier access to credit has vastly increased car ownership among a burgeoning middle class.

Total sales in the first quarter of 2011 rose 3.6% to 777,725 vehicles, Fenabrave data showed, with a record for the month of February and March's rise compensating for sales which plunged 36% in January.

Brazil's automakers' association has estimated total sales of 3.69 million vehicles in 2011 including buses and trucks, 5% more than in 2010. Fiat leads sales followed by Volkswagen, General Motors and Ford.