Market Report, "Venezuela Autos Report Q1 2013", Published

Fast Market Research recommends "Venezuela Autos Report Q1 2013" from Business Monitor International, now available

by Bill Thompson

(WireNews+Co) - Boston, MA - 22 February 2013

Vehicle sales in Venezuela increased 11.2% year-on-year (y-o-y) in the first nine months of 2012. However, sales declined 12.7% y-o-y in September, a considerable slowdown from the 28.9% y-o-y rise in the first four months of 2012. BMI has long maintained sales would drop back in line with our 10.8% growth forecast for 2012, and this view is continuing to play out. BMI believes the relatively buoyant vehicle sales in the first part of the year were down to the credit-fuelled consumption increase, combined with favourable low base effects. The unwinding of this, combined with the expected devaluation of the bolivar, will serve to bring vehicle sales down in line with our forecast this year.

Venezuelan vehicle production in the first nine months of 2012 registered a y-o-y increase of 5%, to 83,790 units. Despite strong growth in the beginning of the year, the sector has become more subdued in recent months. In September, vehicle production declined 21% y-o-y, to 8,038 units. In light of ongoing declines in production and the weak regulatory and industrial environment, we recently revised our forecast to a more bearish 3% increase over the year, from a 10.4% increase previously. Vehicle production in Venezuela was given a boost in 2012 due to close ties between the government and China. In February, Chinese automaker Chery opened four dealerships in the country, and has revealed plans to open 14 more. BMI believes that, without the government-aided investment of Chinese manufacturers, production figures would continue their historic decline due to the lack of changes in the regulatory environment.

View Full Report Details and Table of Contents (http://www.fastmr.com/prod/536599_venezuela_autos_report_q1_2013.aspx?afid=201) (http://www.fastmr.com/prod/536599_venezuela_autos_report_q1_2013.aspx?afid=201)

Our core outlook for the segment currently forecasts vehicle production reaching 140,909 units by 2016, still a far cry from over 172,000 units produced in 2007, prior to the imposition of import restrictions. Given that growth in domestic sales in directly related with dynamics in the production segment, we forecast vehicle sales to reach 198,500 units by the end of 2016 forecast period. This is still far below the 492,000 units peak reached in 2007.

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