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South America Automotive Market - Growth, Trends, and Forecast (2019 - 2024)

  • ID: 4773662
  • Report
  • Region: South America
  • 80 pages
  • Mordor Intelligence
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FEATURED COMPANIES

  • Aptiv PLC
  • Denso Corporation
  • GM Financial (Banco GMAC)
  • Honda Motor Company Ltd.
  • Kia Motor Corporation
  • Santander Bank
  • MORE
Market Overview

The South America Automotive Market is anticipated to grow at a CAGR of 4.79% during the forecast period, 2019-2024.

The prime factors driving the growth for the sales and demand for the passenger cars were lower interest rates and improving consumer confidence. For instance, the exports and sales of passenger cars in 2018, when compared with the first four months of 2017; witnessed an increase of 50.4% and 9.9%, respectively.

However, the automotive market in South America is highly vulnerable to the instability of social and political policies, as countries, like Venezuela, are experiencing a slowdown in their economic growth, which drastically impacted the country's automotive industry growth.

In Brazil, with the improvement in the economy (directly influencing consumer confidence) and rise in credit availability to support the country’s light-vehicle market, growing investment in the country, and strong export demand, the country has been witnessing positive growth in the demand and sales of vehicles.

Scope of the Report

The South America automotive industry outlook covers the growing demand for passenger cars and commercial vehicles in the country, Investments done by OEMs to establish their presence in South America and market shares of OEMs.

The South America automotive industry has been segmented by vehicle type, parts & components type, automotive service industry type, and automotive financing industry type.

Key Market Trends

Brazil, Argentina, Chile, and Ecuador to drive the Market

The passenger car market in South America has witnessed healthy growth during the first half of 2018. Car sales in the region have increased by 7.1% to 1.39 million units as compared to 1.30 million units in Q1 of 2017. This growth was primarily contributed by the Brazil and Argentina Markets.

The Brazilian automotive industry’s output has fallen consistently, following the economic recession that affected production and sales alike. However, the industry is now gathering momentum, due to the improvement of the economic indexes directly influencing consumer confidence and increase in credit availability to support the country’s light-vehicle market and strong export demand from South American countries.
  • As a result of low-interest rates on cars and improving customer confidence in Brazil, the automotive sales in the country increased by 14.8% to 527,000 units in Q1 of 2018 as compared to 459,700 units in Q1 of 2017.
Argentina is the second largest passenger car market in the South American region. Although the country witnessed a drop in sales during Q3, strong incentive campaigns by OEMs is expected to boost the sales of passenger cars over the forecast period.

The passenger cars and light commercial vehicles sales have increased by 42.4% in Ecuador and 17.6% in Chile during Q1-Q3 2018.

Auto Policies and Incentives Supporting the Growth of Brazil Automotive Industry

The country is the largest market and the largest producer of automotive in the South American continent. In 2018, Brazil alone accounted for about 50% of the vehicles of all types sold in the region. New vehicles sales increased by 5.2% to 2.87 million units in 2018 as compared to 2.69 million units in 2017.

Brazil had experienced a volatile economy over the past few years, and the GDP growth rate in 2015 was -3.7%, but in 2016, it became -3.3%. Political instability, high inflation, low prices of export of goods, and depressed confidence levels, have caused a decline in the Brazilian economy.

Traditionally, Brazil had protectionist policies in place as a part of its Inovar Auto policy to support the local automotive companies from imports by offering tax credits and other incentives. However, the outcome of the policy was increased domestic competitiveness and decrease in imports. The policy did not have any provisions for export promotion, which impacted the industry when domestic demand declined.

But, in 2018, due to the renewed expectations, due to the improvement of the economic indexes directly influencing consumer confidence and increase in credit availability to support the country’s light-vehicle market, new automobile sales increased by 23.14%, in January 2018, as per the National Federation of Automotive Distributors. Additionally, overall light vehicle registrations rose to 9.4% in 2017 and 13.8% in 2018, and 2019 has started off with growth.

With the recovering automotive industry, due to the growing exports and the stabilizing economy, the market is expected to grow at a good rate during the forecast period. Additionally, the country has been witnessing a rise in the sale of luxury cars, owing to increasing demand for SUVs and crossovers.

The commercial vehicles segment is also expected to see increased demand, as the government has prioritized development of infrastructure as a part of its Brazilian Investment Partnership Program launched in 2016, which is also supported by growth from farm mining sectors.

Competitive Landscape

Some of the major manufacturers in the South American automotive market include General Motors, Toyota Motor Corporation, Hyundai Motor Corporation, and Volkswagen AG. General Motors covered a major share in the market in 2018, and Chevrolet brand vehicles dominated with the highest sales in the region. This is followed by Volkswagen, Nissan, and Toyota.

During the Q1 of 2018, Renault and Fiat introduced new models into the market. The Renault’s Kwid sold 20,119 units and Fiat’s Argo sold 17,522 units and stood among the top sold cars during the same period.

Luxury car makers, like JLR, has been investing in the country, which will aid in boosting the country’s automotive industry. For instance, JLR invested BRL 750 million (USD 392 million), about four years ago, in 2014, to build its Brazilian factory, after the government vowed to tax imported cars if automakers do not have a local presence.


As part of this package, any purchases made up to 30th June will receive the following:

1) Free update of the report in 6 months on request 

2) Free Market Estimate sheet excel data sheet
Note: Product cover images may vary from those shown
2 of 4

FEATURED COMPANIES

  • Aptiv PLC
  • Denso Corporation
  • GM Financial (Banco GMAC)
  • Honda Motor Company Ltd.
  • Kia Motor Corporation
  • Santander Bank
  • MORE
1 INTRODUCTION
1.1 Study Deliverables
1.2 Study Assumptions
1.3 Scope of the Study

2 RESEARCH METHODOLOGY

3 EXECUTIVE SUMMARY

4 MARKET DYNAMICS
4.1 Market Overview
4.2 Market Drivers
4.3 Market Restraints
4.4 Industry Attractiveness - Porter's Five Force Analysis
4.4.1 Threat of New Entrants
4.4.2 Bargaining Power of Buyers/Consumers
4.4.3 Bargaining Power of Suppliers
4.4.4 Threat of Substitute Products
4.4.5 Intensity of Competitive Rivalry

5 MARKET SEGMENTATION
5.1 By Vehicle Type
5.1.1 Internal Combustion (IC) Engine
5.1.1.1 Passenger Cars
5.1.1.2 Commercial Vehicles
5.1.2 E-mobility
5.2 By Parts and Components Type
5.2.1 Powertrain
5.2.2 Exterior and Interior
5.2.3 Tires
5.2.4 Advanced Driver Assistance Systems (ADAS)
5.3 By Automotive Service Industry (Qualitative Information)
5.3.1 OEM Service Center
5.3.2 Independent Aftermarket Service Center
5.4 By Financing Industry (Qualitative Analysis)
5.4.1 Banks
5.4.2 Automotive Financial Dealers
5.5 Geography
5.5.1 South America
5.5.1.1 Brazil
5.5.1.2 Argentina
5.5.1.3 Chile
5.5.1.4 Peru
5.5.1.5 Rest of South America

6 COMPETITIVE LANDSCAPE
6.1 Vendor Market Share
6.1.1 OEM (by Vehicle Brands) - Market Share Analysis
6.1.2 Auto Parts & Components Suppliers - Market Share Analysis
6.2 Company Profiles
6.2.1 OEM (by Vehicle Brands)
6.2.1.1 General Motors
6.2.1.2 Toyota Motor Corp.
6.2.1.3 Volkswagen AG
6.2.1.4 Fiat Chrysler Automobiles NV
6.2.1.5 Ford Motor Company
6.2.1.6 Honda Motor Company Ltd.
6.2.1.7 Hyundai Motor Company
6.2.1.8 Nissan Motor Company Ltd.
6.2.1.9 Groupe Renault
6.2.1.10 Daimler AG
6.2.1.11 Kia Motor Corporation
6.2.2 Auto Parts & Components
6.2.2.1 Robert Bosch GmbH
6.2.2.2 Continental AG
6.2.2.3 Denso Corporation
6.2.2.4 Aptiv PLC
6.2.2.5 HELLA KGaA Hueck & Co.
6.2.2.6 Webasto
6.2.2.7 Valeo Group
6.2.3 Auto Financing Suppliers
6.2.3.1 Banks
6.2.3.1.1 Santander Bank
6.2.3.1.2 Banco Bilbao Vizcaya Argentaria (BBVA)
6.2.3.1.3 Itaú Unibanco
6.2.3.2 Automotive Financial Dealers
6.2.3.2.1 Toyota Financial Services
6.2.3.2.2 GM Financial (Banco GMAC)
6.2.3.2.3 VW Financial Services

7 MARKET OPPORTUNITIES AND FUTURE TRENDS

8 LIST OF AUTOMOTIVE PRODUCTION PLANTS AND THEIR CAPACITY, BY COUNTRY

9 DISCLAIMER
Note: Product cover images may vary from those shown
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  • General Motors
  • Toyota Motor Corp.
  • Volkswagen AG
  • Fiat Chrysler Automobiles NV
  • Ford Motor Company
  • Honda Motor Company Ltd.
  • Hyundai Motor Company
  • Nissan Motor Company Ltd.
  • Groupe Renault
  • Daimler AG
  • Kia Motor Corporation
  • Robert Bosch GmbH
  • Continental AG
  • Denso Corporation
  • Aptiv PLC
  • HELLA KGaA Hueck & Co.
  • Webasto
  • Valeo Group
  • Santander Bank
  • Banco Bilbao Vizcaya Argentaria (BBVA)
  • Itaú Unibanco
  • Toyota Financial Services
  • GM Financial (Banco GMAC)
  • VW Financial Services
Note: Product cover images may vary from those shown
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