SAO PAULO: Brazil’s sales of new vehicles, along with production and exports, dropped in the first half of this year, as the country’s economy fails to regain traction, hurting consumer confidence.
Sales of cars, light vehicles, trucks and buses totaled 1.32 million units in the first half of the year, down 21% from a year earlier, auto industry association Anfavea said Monday. Vehicle sales fell 19% in June from a year earlier to 212,524 units.
Production fell to 1.28 million vehicles in the first half of the year, a decline of 18.5% from the year-ago period. June output fell 15% to 184,015 units.
Exports by value fell 7.4% in the first half of 2015 to $5.5 billion. Exports for June, however, were up 20% from a year earlier at $1.01 billion.
Economists say a toxic combination of weak economic growth, high inflation and rising interest rates are hurting consumer confidence, especially toward big-ticket items.
Brazil’s economy expanded 0.1% in 2014 and is expected to contract by 1.5% this year, according to economists surveyed by the country’s central bank.
Falling consumer demand has forced many auto makers in Brazil to lay off employees, and implement voluntary severance programs and mandatory vacations.
The largest auto makers in Brazil by sales are Fiat Chrysler Automobiles NV (FCAU, FCA.MI), General Motors Co. (GM ), Volkswagen AG (VOW.XE, VLKAY), and Ford Motor Co. ( F).
