Revival of the Automotive Market By Luís Otávio Matias

H2: The car industry in Brazil recovers its post-pandemic pace

Just like a swimmer who emerges to breathe between strokes, the market also needs its moments of recovery. And arguably, the Covid-19 pandemic has presented one of those underwater challenges for many sectors, including the automobile industry.

H2: Three years underwater: The automobile industry in retrospect

The waves of the pandemic engulfed several sectors in 2020, and the feeling was that we were trapped beneath these waves, anxiously awaiting that invigorating breath. And the automobile sector, like many others, faced this moment of suffocation. But as any good swimmer knows, after resistance comes relief. And now, we're starting to see signs that the segment is finally taking its breath.

With a 12,5% ​​increase in new vehicle sales in the first half of 2023 and a 4,6% growth in used car sales, compared to the same period last year, the recovery is palpable. These optimistic numbers are courtesy of Fenabrave.

H2: Rescue maneuvers: Government initiatives and trends

The federal government did not stand still and launched an incentive package for the return of the iconic “popular car”. In the Brazilian scenario, this vehicle has an immeasurable value, considering the economic outlook of the majority of citizens. The reintroduction of this more affordable transport option was one of the reasons for the reinvigoration of the sector.

But the success was not just due to this stimulus. Data from Anfavea showed that positive results were visible even before the end of June, driven by measures launched in May 2023. Adding to this, we have a notable drop in unemployment and the slowdown in inflation. Both factors created a favorable environment for the resumption of automotive industry.

And to add an additional layer of optimism, the recent reduction in interest rates signals that we can expect more positive news on the horizon. We are far from crossing the finish line, but the feeling of relief is undeniable. The test continues, and although the road ahead still has its challenges, the industry is equipped and ready to accelerate.

Source: Central Press – Luís Otávio Matias is the vice-president of Tecnobank.

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