Brazilian heavy truck sales to return to growth in 2017

[kscarbel2]

Automotive Business  /  January 5, 2016

The Brazilian Association of Automotive Vehicle Manufacturers (ANFAVEA) says heavy vehicle sales should return to growth in 2017 after three consecutive years of decline.

ANFAVEA expects a 6.4 percent sales increase this year resulting in 65,600 heavy trucks and buses. Brazil saw 61,700 new vehicle registrations in 2016, almost 30% lower than the previous year.

"There will be growth because the base is very low," says ANFAVEA vice president, Luiz Carlos de Moraes. The expected sales rise represents about 4,000 to 5,000 units more than 2016: "We are talking about an average of 500 more units for each automaker this year."

A key factor is the need of fleets to replace aging trucks: "The reductions that have occurred in recent years have been very drastic; We still have older fleets, there should be a moderate renewal, "Moraes argues. Adding to this is the expectation for the next crop season, also capable of stimulating some market niches.

In addition, Moraes cites the signaling of interest rate reductions, which may help in reducing inflation and, consequently, in a gradual improvement in the economic scenario.

"The government also signaled infrastructure announcements by the end of the first half. Even if moderately, there will be growth, "he argues.

If ANFAVEA is optimistic about 2017, 2016 is a year to forget: truck registrations totaled just 50,500 units, returning to the 1999 level.

With a market well below the country’s truck manufacturing capacity, the production of trucks in 2016 was 18.2% below the previous year, closing with 60,600 units.

In the bus chassis segment, the scenario was no different: in 2016, with a little more than 11,100 new buses registered, a decline of 33.5 percent.

While domestic sales declined, bus chassis exports rose 33.2 percent to 9,700 units. However, production was still 13 percent lower than in 2015, when it totaled 18,700 units.