Brazil Autos Report Q3 2015 - New Market Report

Due to Brazil's worsening macroeconomic outlook, BMI forecasts a 16.8% drop in vehicle sales in 2015, as declines in the passenger car segment are outpaced by stronger declines in the commercial vehicle (CV) segment.

We forecast a 14.1% decline in passenger car sales in 2015 with sales reaching almost 2.40mn units for the year. Rising borrowing costs and increased vehicle prices will provide added drag to the passenger car market, which is already hamstrung by falling consumer confidence and spending.

In 2015, BMI expects to see a 27.5% decrease in CV sales. More specifically, we forecast light commercial vehicle (LCV) sales to drop 27.0% to 393,527 units as borrowing costs and falling investment spending will limit business purchases. Heavy trucks will also be hit by rising interest rates as well as an ongoing crisis in the construction as well as oil and gas sectors, which will drag sales down by 31.0% to 94,579 units. Finally, we expect bus and coach sales to fall by 19% after government spending cuts extinguished the chance of an increase in public transport investments.

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Owing to this bearish sales outlook and the orientation of Brazil's manufacturing industry towards the domestic market, rather than export markets, BMI is also becoming more bearish on the country's production outlook. Indeed, we expect a continuation of the large falls in output seen in 2014, with total vehicle production forecast to decrease 11.9% in 2015. Breaking down this forecast, we expect passenger car production to fall 11.7%, LCV output to drop 9%, heavy trucks to decrease by 29% and bus manufacturing to shrink by 10%.

Over the long run, we expect exports to play an increasingly important role in output growth, but volumes are likely to remain relatively minimal over 2015 and 2016 and will not be the primary driver of production.

The Brazil Autos Report features the latest data and forecasts covering production, sales, imports and exports.

BMI Research's Brazil Autos Report provides industry professionals and strategists, corporate analysts, auto associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on the automotives market in Brazil.

Key Benefits

* Benchmark BMI's independent automotives industry forecasts on Brazil to test other views - a key input for successful budgetary and planning in the Brazilian automotives market.
* Target business opportunities and risks in the Brazilian automotives sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Brazil.
* Assess the activities and market position of your competitors, partners and clients via our Competitive Landscape Analysis.

Coverage

BMI Industry View

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