The last quarter of 2021 begins with a slight recovery in the automotive sector. With 177.9 thousand units manufactured, the production of light and heavy vehicles registered a 2.6% increase compared to September. The data were released this Monday (8) by Anfavea (Assembly Association).
The numbers are at the center of the projections made by the organization in early October. The association calculates that, if there is a regularization of the supply of semiconductors, around 570 thousand vehicles should leave the factories between October and December. Thus, the year would close with 2.219 million light and heavy vehicles produced, an increase of 10% compared to 2020.
In a more conservative view, production will be 2.129 million units, an increase of 6% compared to last year.
Sales of light and heavy vehicles increased by 4.71% between the months of September and October. The data was released on Thursday (4) by Fenabrave (the association that brings together vehicle distributors). 162.4 thousand units were sold.
The results may even indicate calm, but continue pointing to a difficult last quarter. The stoppage of autonomous truck drivers is a new factor: in addition to the lack of parts, there are now difficulties in distribution due to problems at the Port of Santos.
Luiz Carlos Moraes, president of Anfavea, admits that the risks of stoppages in production lines have increased. “It is the largest port in Latin America, many automakers have already tried to release goods last week.”
This is yet another negative factor in a year in which vehicle sales have not exceeded 200,000 units in any month so far. The results already arouse suspicions about 2022, which should start with more expensive credit and low confidence in the economic policy of Minister Paulo Guedes.
“In 2016, Congress approved the ceiling PEC, but in recent weeks the government decided to forward the precatório PEC. The market reaction was for the dollar to rise even more, the rise in interest rates – there are already people talking about Selic at 12 %– and the worsening of the country risk. All of this brings a business environment that is not good”, says Moraes. “There is also talk of stagnation, recession or very low growth.”
The increase in the basic interest rate directly influences the cost of financing. Based on information from the Central Bank, Anfavea collected data on the average amounts of the CDC (direct credit to the consumer), the main installment payment tool for the purchase of automobiles.
The average rate reached 23.9% per year in September, against 22.7% in August and 18.6% in September 2020. The current level is the highest for individuals since June 2017, and Anfavea already works with a scenario of CDC at 26% per year for 2022.
The rise in interest is added to the inflation of the car. The transfers in view of regulatory changes (which require investments in safety and emission reduction), increase in inputs and changes in the assemblers’ strategy should have a greater effect on trade in 2022.
The account also includes the majority elections, a time when uncertainty about the direction of policy changes the mood of consumers and investors.
“All the indicators are the worst possible. Prices have risen absurdly, and today there is only a car missing because we have restrictions on the supply of semiconductors. If we had these components available, we would be at a level very close to that of 2019”, says Cassio Pagliarini, partner at Bright consultancy.
According to the expert, the readjustments in the tables of cars throughout 2020 and 2021 (until August) accumulate 18% above inflation in the same period.
“I don’t believe in more than 2.4 million cars sold next year, as there will still be problems with semiconductors, wages will not recover from the increase in car prices and we will have higher financing costs,” says Pagliarini .
If negative factors lead to a drop in demand, production will be harmed once again. It will be a very different scenario from the optimism experienced a year ago, in the midst of the pandemic.
In October 2020, the assemblers worked in two shifts and until Saturdays to reconcile distance measures in the production lines and the resumption of sales. It was not expected that the health crisis was so far from over and that it would get worse, nor that the shortage of parts would be so long.
Going back another year in time, it reaches 2.55 million units produced between January and October 2019. Repeating this number was the dream of the assemblers for 2021, but the signs indicate that, perhaps, this result is utopian even in 2022.
In the accumulated result for this year, 1.83 million light and heavy vehicles were assembled. The result means an increase of 16.7% compared to the weak 2020, but if the basis for comparison is the same period in 2019, there is a drop of 28.2%.
If there is a combination of stability in production with lower demand in retail, rental companies will benefit. The sector is still waiting for new cars, although it has acquired around 20% of the cars produced in Brazil this year.
Stocks remain low. According to the association of assemblers, there are 93,500 vehicles in the factory and dealership yards, which is enough to supply 17 days of sales.
Exports registered an increase of 26.1% between September and October, with 29,800 units shipped mainly to South American markets. Chile, Colombia and Uruguay have stood out, while Argentina continues with lower volumes due to the economic crisis .
“Argentina has a foreign exchange problem, which is not new. There is a reduction in the importance of this market, but the country is very relevant in terms of total Brazilian exports,” says Moraes.
Brazil is also the biggest buyer of cars assembled in the neighboring country, which produces vehicles with higher added value – therefore, they do not need such high volumes of production to achieve the desired profitability.
The national automotive industry still depends on increased productivity to become profitable, especially in light of the renewal of compact models.
Citroën, Fiat, Volkswagen, Honda, Toyota and General Motors are among the manufacturers that are preparing new products for the entry-level segments for the next two years. Only one should not wait for models with prices below R$ 60 thousand.
“The car we sell today is not the same as it was in the 1980s, it is no longer possible to imagine that we will have a very simple car, there are regulations and the new demands of society”, says the president of Anfavea. “We want to stimulate [o mercado] to forget about this figure of the popular car, this is past, it no longer makes sense.”
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