Brazil - Vehicle stock reaches a level below the pre-pandemic

AUGUST 11, 2020
Brazil - vehicle stock

Seeking to balance the supply with the new market levels, the automotive industry closed July with stocks below the traditional numbers of the sector, which revolve around 30 to 35 days of sales considering the yards of the factories and those of the automotive companies. The total number of vehicles in storage fell from 157,600 in June, or 27 days of sales, to 138,300 last month, which is equivalent to just 24 days.

The reduction was greater in the yards of the auto companies, which closed July with a stock of 31.3 thousand units, a volume almost 30% lower than the previous month (41.8 thousand). In concessionaires, the reduction went from 115.8 thousand to 107 thousand, minus 7.6%. On sales days, the drop is 5% in the network and 25% in the industry.

The president of Anfavea, Luiz Carlos Moraes, recalls that when the quarantine began in the country, due to the Covid-19 pandemic, stocks reached practically four months of sale, which affected the financial health of both automotive and dealerships . Thereafter, each manufacturer sought to match supply and demand, which contributed to reducing stocks to current levels.

He even admits that there may be a lack of specific models on the market, saying that it is now up to each automaker to calibrate production against retail demand. Each one will see which model has more or less demand to adjust the factories to the new sales moment ”.

Despite the positive performance in July, with a total of 174.5 thousand plates, 31.4% more than in June, the president of Anfavea, Luiz Carlos Moraes, says that the scenario is still cloudy ahead, that is, exactly how the market will behave this year cannot be predicted.

For the moment, the entity maintains the projection of a 40% drop in national sales, up to 1.65 million vehicles, an index that can be revised in August or September depending on the behavior of the market in the coming weeks.

Average daily sales before the pandemic ranged from 11,000 to 13,000 units, a figure that dropped to 7.6,000 in July. According to the Anfavea president, August started at a similar volume to last month, but says it is too early to predict how the month will end. We will follow the movement of the next days, without forgetting that August will have two business days less than June, which may affect the comparison of absolute numbers ”.

Moares also commented on the rise in the dollar, saying that a transfer to prices is inevitable. He recalled that exports were also strongly affected, which avoids offsetting the losses in imports with a higher volume of sales abroad.

Source: Fenabrave

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