According to the Los Angeles Times, new car sales in South America are skyrocketing, thanks to wage hikes, more jobs and easy credit terms. Last year, there were 3.5 million new car and light truck purchases in Brazil alone, representing an 86-percent increase over 2006.
While Brazil leads the charge in terms of new car sales numbers, Peru topped the heap in terms of per capita market growth, moving 106,000 new cars in 2010, or three times its 2006 total. Argentina and Columbia also experienced car-buying booms, with their markets growing by 25 percent and 50 percent respectively over 2006.
Despite car-buying increases in Argentina, Brazil, Columbia and Peru, the trend doesn't ring true in Mexico, where new car sales have dwindled. In 2006, Mexicans bought 1.2 million new cars, as opposed to just 820,000 in 2010. Dealers blame the decline on Mexico's opening the market to used American cars. Venezuela saw a decrease, too, after import duties were increased in an attempt to stem inflation.
The trend is obviously good for automakers like General Motors, who move plenty of metal in Latin America, and need all the help they can get from expanding markets. Importantly, the upward trend in new vehicle sales also shows that at least some South American economies are beginning to stabilize. Easy credit, longer loan repayment periods and consumers' increased disposable income indicate that the region as a whole is on the rise.
[Source: The Los Angeles Times |Image: Rafael Cavalcante – CC 2.0]