MercoPress. South Atlantic News Agency

Brazil anticipates 40% fall in sales of cars, light commercial vehicles, trucks and buses, this year

Compared to May 2019, there was a decrease of 84.4% in vehicles (43,100); 63.9% in trucks (4,100 units), and 29.5%, agricultural and road machinery (3,600 units).

Brazil's National Motor Vehicle Manufacturers Association (Anfavea), predicts a 40% drop for the sale of the set of new vehicles, composed of cars, light commercial vehicles, trucks and buses in 2020.

According to the entity’s president, Luiz Carlos Moraes, the total number of licenses will be 1.675 million vehicles. Last year, 2,788 million vehicles were licensed. “The fall is impressive, and it is even more serious in comparison with the forecast made at the start of the year which was 3.5 million, representing a fall of 45%”, he stressed.

According to Anfavea, the economic crisis caused by the pandemic of the new coronavirus is the main reason for the drop in sales. The organization believes, however, that the sale of trucks should fall less, mainly due to the fact that some sectors, such as agribusiness, which are demanding a higher level of transport.

According to Moraes, it is still not possible to project the fall in production with greater precision, as it also depends on the export scenario, which remains cloudy. The same holds true for the agricultural machinery sector, which has so far been least impacted by the crisis.

The results for May were better than those for April, the month in which there was an almost complete stoppage of factories and dealers across Brazil. But in comparison with the month of May 2019, there was a decrease of 84.4% in the production of vehicles (43,100 units produced), 63.9% in the production of trucks (4,100 units), and 29.5% for agricultural and road machinery (3,600 units).

The exports of motor vehicles fell by 90.8%, and agricultural machinery by 39.4%. The only positive data for May was the sales growth of 23.3% of agricultural vehicles year-on-year. Meanwhile, sales of vehicles dropped 74.7%, and trucks dropped 47.2% over the same comparison period.

The accumulated result for the year so far shows vehicle sales approaching a 40% drop, while production and exports have already shrunk by almost 50%.

Production and exports of machinery dropped around 30% but sales within the 0domestic market remained stable. “Although June signals some more effective return to activities, we will undoubtedly have the worst quarter in the history of the automotive sector. We must wait and see what will happen in the second half of the year and if there will be no further damage to the automotive chain”, concludes the President of Brazil's Anfavea.