São Paulo – The number of imported automobiles licensed in Brazil in 2011 increased by 87.4% compared with 2010. According to an industry overview issued this Wednesday (11th) by the Brazilian Association of Motor Vehicle Importers (Abeiva), 199,366 units were sold, as against 106,360 in the preceding year. Imported vehicles accounted for a 5.82% share of the Brazilian market.
The figures also show that in December last year, there was a 26.8% increase in sales, which reached 19,151 units, as against 15,098. In comparison with December 2010, when 13,487 units were sold, there was a 42% increase.
According to the Abeiva president, José Luiz Gandini, it is still too early to make projections for 2012, but to him, imported vehicle sales should drop by around 20%. According to him, it will be best to evaluate the industry’s performance by February or March, because many consumers are on holiday in January, and therefore do not purchase automobiles. Only from the third month onwards, by Gandini’s calculations, will the dealerships be able to ascertain how the raised Tax on Industrialized Goods (IPI) for imported autos will influence sales.
“We will get a feel for the market, see how much of the tax each brand will build into their prices, and how consumers will behave,” he said. A government decree raised the IPI on imported cars by 30 percentage points.
According to Gandini, the Abeiva is pondering the unconstitutionality of the decree that raised the IPI on imported vehicles, but has not reached a definitive conclusion yet, due to the level of legal difficulty stemming from it being a dispute with the government. “It is very tough for us to make a decision of this sort, and that is why we have not questioned the validity of the decree, which is unconstitutional. Whenever a given product enters the country, an import tax is paid on it, after which said product is considered a national product. Thus, the IPI cannot be charged differently for national and imported goods.”
*Translated by Gabriel Pomerancblum
