The latest official estimates in the state of Sao Paulo reveal that an average decrease of 3.2% will affect the prices of thousands of cars with different models.
In a related context, the decline in car prices will lead to a decrease in fees for fees paid by car owners. Where car owners pay fees of up to 4% of the value of the car annually.
The devaluation has led to an increase in the average life of cars in São Paulo in recent years.
In that regard, with the intensification of the economic crisis, consumers resorted to replacing the purchase of new visits with the purchase of used cars, which led to the revitalization of the used car market.
The total number of cars of all kinds in the state of São Paulo is about 24 million cars, and among these cars, 17.4 million cars are subject to paying fees.
On the other hand, 6.8 million cars are considered duty-free because of their long life, in addition to about 295,000 exempt from payment (taxi drivers, non-profit entities, official vehicles, large buses and minibuses).
This is how the Brazilian auto industry developed
The Brazilian auto industry actually started in 1925, when the American Chevrolet began collecting and producing its offers.
The first Brazilian cars were produced in 1956.
The Japanese were the first to set up a factory there, when Toyota began producing its Land Cruiser model by 1958.
- Volkswagen began assembling and producing its Model Combi at its first factory there in 1959.
- In the sixties, the American invasion came by Chevrolet and Ford with the start of assembly and production of trucks, along with the Italian Fiat, which established its first factories in this important era, and Mercedes-Benz, which in turn went to the production and assembly of trucks and buses at the time.
These companies dominated the Brazilian market until the mid-nineties of the last century, a time that saw the Brazilian market open to many other manufacturers, such as Nissan, Renault, Peugeot, Citroen, Honda, Hyundai, Chrysler and others.
- In the late seventies, many new American and German projects were established in the automotive sector, which brought the annual production rate to one million units. Brazil ranked tenth in the list of the largest auto manufacturers in the world in terms of production volume.
- After a difficult period in the nineties, the growth rates began to witness remarkable improvement with the help of foreign players who appeared on the scene, which made the Brazilian market compete and outperform other old markets, such as the United Kingdom, Italy, Canada, Russia, Spain and France, where the annual production volume in Brazil reached 3.34 One million units in 2012.
Then, the government's efforts to boost the demand for small cars began by establishing a program known as the “Popular Car”, which targeted low-income customers.
- Thus, the original Volkswagen Beetle show star brightened, and soon these small and essential offers quickly took over the sales list in a few years.
- With the growth of the Brazilian economy, the appetite of customers has increased towards the latest and best offers, which has led many manufacturers to launch exclusive models specifically for the Brazilian market.
- Ethanol has become the preferred fuel option for Brazilians as the government seeks to increase its production of sugar cane crops to reduce costly traditional oil imports.
With an increase in the income levels of individuals, more than 40 million Brazilian citizens managed to join the middle class for the first time since 2003.
Gross domestic product rose to $ 10,000 per capita, a relatively good rate for which markets are known when they are headed for growth.
In addition to Volkswagen, Fiat, General Motors and Ford, new players have appeared on the scene such as Kia, Hyundai, Honda, Nissan, BMW, as well as Chery, Geely and some other Chinese companies.
- A strict government policy: After the flood of foreign cars that filled Brazil, the thirty-sixth president of Brazil, Dilma Rousseff, who took office in early 2011, decided to increase taxes on imported cars from 25 percent to 55 percent, which made a car like the new Toyota Corolla, which Sold in the United States of America for $ 16,230, sold in Brazil at $ 29,000. Because of Mexico’s tax exemption through a regional trade agreement, some manufacturers have sent more cars to Brazil through their Mexican factories, but the first woman to take over the presidency of Brazil has understood this trick, so she limited the amount of Mexican imports. On the other hand, car companies can pay less taxes on their imported cars if many of the Brazilian-made parts in local factories are used in the components of their imported offers, according to the Forbes website report.
- Although the wages of workers in the auto sector have increased in Brazil by 125 percent over the past decade, this increase has not been matched by a similar increase in productivity, but production rates have increased only by 22 percent in the same period, due to obstacles such as the non-shift to operations Automation, lack of quality training, and high costs of iron and energy in general.