What are the key factors that have led to the recovery of the automotive sector in Brazil?
The recovery of the Brazilian automotive sector was led primarily by a revival of domestic demand and to a greater extent, an increase in exports. Domestic growth was driven by the stabilization of the economy in the recent years, a rise in consumer confidence and a decrease in interest rates. Brazilian exports have risen as a result of relatively weak currency, a regional economic recovery, and trade agreements entered into by the Brazilian government. To what degree has the appreciation of the currency affected vehicle exports? The Brazilian currency appreciation experienced in recent months has negatively impacted the competitiveness of exports as many automakers have been unable to pass price increases due to exchange rates onto the consumer, and therefore demand for Brazilian exports has been in a state of decline. Those who continue to export are likely doing so at a loss – the question is for how much longer? For some time the appreciated currency has hidden some unfavorable cos
