Parts shortages and high interest rates lower automotive sector expectations for 2022

After a year with only 3% growth in sales of passenger cars, light commercial vehicles, buses and trucks, Fenabrave projects an equally warm 2022.

The entity, which represents car, motorcycle and truck distributors, released its forecasts this Thursday (6). The expectation is for growth of 4.6% in the commercialization of light and heavy vehicles.

The number is based on the reality of the market and is quite different from the forecast in January 2021, when Fenabrave projected a growth of 16%. The sector was going through a V-shaped recovery, which soon proved inconsistent in the face of the problems that followed.

The combination of lack of parts, rising car prices, high fuel prices and higher credit continues to harm sales — which should also be affected by the election period, when consumers avoid incurring large debts.

“We are still experiencing a global crisis in the supply of inputs and components, and new challenges have arisen for the sector, such as the constant increases in interest rates”, says José Maurício Andreta Júnior, elected president of Fenabrave for the triennium 2021-2024.

For economist Teresa Maria Fernandez, from MB Associados, what is happening is a change in monetary policy in the world, with a more aggressive increase in basic rates.

This Wednesday (5), the Fed (American Central Bank) released the minutes of its last meeting, which indicates the need to raise interest rates sooner than expected in the face of inflationary pressure, which will generate the appreciation of the dollar against the real. In Brazil, the upward movement tends to persist.

“We believe that our Central Bank will maintain the policy of increasing interest rates, and the Selic rate should end the year between 11.5% and 12%”, says the economist.

Fenabrave expects 2.216 million light and heavy vehicles to be licensed in 2022. Last year, 2.12 million units were sold.

By breaking down the numbers, it is possible to confirm the strategy of the automakers amid the shortage of components. The companies directed their efforts towards the production of models with greater added value. Therefore, more profitable.

While the passenger car segment — which has the highest volume and includes compact cars — fell by 3.6% over the past year compared to 2020, light commercial vehicles, a niche in which sport utility vehicles and pickup trucks, recorded an increase of 24.2% in the same period.

A breakdown of the truck sector shows that 127,400 units were sold in 2021, up 42.8% from 2020. The rise was mainly driven by agribusiness. Fenabrave expects the expansion to continue in 2022 and projects a growth of 7.3% throughout the year.

There are still waiting lines: some heavy vehicles traded at the end of last year should only be delivered in June. The same problem affects the light vehicle sector, due to supply problems. Production data will be released this Friday (7th) by Anfavea (association of automakers).

The results were good in the motorcycle segment, which ended 2021 with 1.16 million units sold. It was up 26.4% over the previous year, and the dealers’ association expects sales to grow by 6.2% in 2022.

Samir Dahas Bittar, vice president of Fenabrave, highlights that the expansion of the motorcycle sector is due to food and merchandise delivery services. This trend has continued strong since the beginning of the Covid-19 pandemic in March 2020.

But there is the problem of credit in this segment. According to Fenabrave, only 35% of customer files presented to banks have been approved.