Brazil's domestic auto market is in short supply, increasing import pressure

Geszar Automotive reported that Brazil, the world’s fourth-largest auto market, will continue to maintain rapid growth in 2010. However, Brazil’s local auto parts supply is insufficient, resulting in Brazil’s domestic auto supply being in short supply, and Brazil’s auto import pressure is increasing. .

The global economic recovery has increased the income of Brazilians and the demand for cars in Brazil has soared. In 2009, Brazil became the net importer of automobiles for the first time in 13 years. This year, Brazil will continue to be a net importer of automobiles.

Due to the insufficient supply of local components, the capacity of Brazilian automakers cannot meet the needs of the domestic market. However, the difficult situation of Brazilian automakers is good news for neighboring Argentina. In 2009, Brazil imported 207,473 vehicles from Argentina, an increase of 33% year-on-year.

Economist Octavio de Barros, an economist at Brazil’s Bradesco Bank, predicts that Brazil’s car sales will continue to increase by approximately 10% year-on-year in the current year and next year, and that Brazil’s car sales will increase to 3.8 million in 2011.

General Brazilian President Denise Johnson said: “We want to produce in Brazil and sell cars in Brazil. Imported cars are only a supplement to occupying market segments. We need to ensure that the mass market models can be produced in Brazil.”

GM is Brazil's third-largest automaker. Its competitors include Fiat, Volkswagen and Ford. The latter three are ranked first, second and fourth among Brazilian automakers.