A consumer market in crisis
In 2020, the automotive industry took a hard hit following the outbreak of the COVID-19 pandemic. In Latin America, light vehicles sales in the largest markets dropped by at least 30 percent in the first half of 2020, when compared to the same period of the previous year. However, the health crisis was just an additional blowback to a market already in decline.Sales of new vehicles in Latin America averaged below six million units per year in the second half of the 2010’s, a decrease of around 18 percent when compared to the nearly 7.5 million units sold in the peak of the decade. This behavior has at least some connection to the economic crisis that hit Brazil – the largest market for car sales in the region – during that period. New vehicle sales in Mexico have also followed a similar trend. But perhaps the most extreme case was reported by Argentina. Amidst economic instability and soaring inflation rates, motor vehicles sales in the country dropped by nearly half in 2019, when compared to a year earlier. With this effect aggravated by the pandemic, a regional recovery may be still far in the horizon.
