As the global financial crisis hit the country's auto industry, car production in Brazil plunged 34.4% in November, automakers announced on Dec. 4.
According to the national association of auto manufacturers, Anfavea, the drop in production brought Brazilian output down to 194,900 units from 296,900 a month earlier.
Fenabrava's figures showed that, in November, car sales declined 30%, year-on-year. Adding all other vehicles, the slump was 25%.
The initial reason for the sudden slowdown was suddenly restrictive access to credit, which has become harder to get and more expensive for Brazilians who had become used to loans with easy and lengthy terms.
The dismal production statistics are the latest dire news for Brazil's auto industry, which after two years of fast-paced growth has run into a brick wall thrown up by the global economic crisis. But concerns triggered by climbing job losses, diving exports and a weakening currency have now also driven consumer sentiment lower.
On Dec. 2, the national car dealers' federation Fenabrave said that new car registrations in November fell 30% compared to the same month one year earlier.
Meanwhile, the Folha de Sao Paulo daily newspaper reports that 47,000 auto workers -- nearly half the total 113,000 in the country -- have been put on mandatory vacation by companies which have cut monthly production by more than 60% as stocks of unsold vehicles pile up.
On Dec. 1, Volvo, a Ford subsidiary, became the first to announce layoffs, cutting 430 workers from its southern plant in Curitiba, or around 18% of its workforce.
But concerns triggered by climbing job losses, diving exports and a weakening currency have now also driven consumer sentiment lower.
Copyright Agence France-Presse, 2008