Brazil’s economy and the sale of luxury cars are driving down different roads this year. While analysts expect Brazil’s overall economy to stall, luxury vehicle sales seem to be moving right along.
Brazil\'s luxury car sales stay steady as overall auto market stallsBrazil’s economy and the sale of luxury cars are on different paths in 2015. While analysts expected the economy in Latin America’s biggest country to stall this year, the market for luxury vehicles is speeding right along. CCTV America’s Paulo Cabral reported from Sao Paulo and took a look at the top end car maker in Brazil.
If an expensive luxury car is what you’re looking for, you’ll find one along Europa Avenue in one of San Paulo’s richest neighborhoods.
Sales of luxury brand vehicles rose 18 percent in 2014, supporting a trend which saw a 39 percent increase the year before. Overall though, total auto industry sales were down more than seven percent recently.
“The sale of luxury cars is a lot less dependent on macroeconomic conditions, because people that buy these cars tend to be a lot less price sensitive, and they are are less susceptible to credit conditions. They keep buying and replacing these cars. You have a sizable proportion of the population with a significant income or wealth,” Leticia Costa, a car industry expert told CCTV.
The luxury segment represents only about two percent of Brazil’s car market, but automakers investing here see the potential for significant growth. Audi plans to reopen a factory it shut down in Brazil 10 years ago.
“This is the fourth biggest automotive market in the world with 3.3 million cars sold last year. This is still a country that the ‘A’ social-class segment is growing, doubling in the last 10 years. So, this hasn’t changed, and this will not change and will even get better. We believe in the long term. We plan a future in Brazil, not short term,” CEO of Audi Brazil, Jorg Hoffman said.
Mercedes-Benz and Land Rover also plan to open plants in Brazil next year joining BMW which opened in 2014 despite an domestic economic slowdown at the time. Analysts say expanding global production and the customer base are keys to making a profit in an emerging Brazilian economy.
CCTV America’s Paulo Cabral in Sao Paulo contributed to this report