Brazil is one of the largest car producers in the world. In February 2019, the country produced 257.2 thousand cars light commercial vehicles, trucks, and buses, accumulating a growth of 5.3% in the first two months of the year, reaching 455.3 thousand units.
Paradoxically, car prices in Brazil are among the highest in the world. In some cases, there are cars that cost more than 100% than in other countries. Among the main reasons for such prices are the very high-profit margins of resellers, taxes and infrastructure problems in the country.
The current Minister of Economy of Brazil believes that some of these problems can be solved with more economic openness.
Last March 29, in a meeting with representatives of the country's three largest automakers (General Motors, Fiat and Volkswagen), Guedes said he would not reestablish the quota system that regulated the automotive trade between Brazil and Mexico, believing that it was time for the country to open its economy.
The representatives of the automakers were criticized by government officials during the meeting, who would have said that the automakers had received R$ 20 billion in subsidies in the last five years. Since March 19, cars and auto parts circulate between Brazil and Mexico without import tariff. Now, the two countries will be able to export and import those products without any barriers.
The Brazilian sectors of Foundries, Auto parts and Assemblers will face a real "competition shock", since these sectors in Mexico are among the most competitive in the world. Therefore, there is a fear on the part of the Brazilian automakers that the parent companies prefer to invest in Mexico instead of Brazil.
In February 2019, Ford announced the closure of its São Bernardo plant in the state of São Paulo, where 3,000 people work, and the company's exit from the South American truck market. Thus, the company's North American headquarters decided to close its subsidiary in São Bernardo.
Showing posts with label automakers. Show all posts
Showing posts with label automakers. Show all posts
Subscribe to:
Posts (Atom)