Number of imported vehicles sold in Brazil in 2011 up by 87.4% year over year to 199,366, trade group says; share of imported vehicles in the Brazilian market now at 5.82%

SAO PAULO , January 16, 2012 () – According to a balance sheet released by the Brazilian Association of Auto Importers (“Associação Brasileira das Empresas Importadoras de Veículos Automotores – Abeiva”), a total of 199,366 imported vehicles were sold in Brazil last year, an increase of 87.4% over 2010, when 106,360 were sold. The share of imported vehicles in the Brazilian market has now risen to 5.82%.

As expected, there was a spike in sales at the end of the year after the government announced a 30 percentage point increase in a tax that will be levied on imported vehicles and consumers rushed to buy before the increase (sales jumped 26.8% in December, compared to November; and leaped 42%, compared to December 2010).

According to the president of Abeiva, José Luiz Gandini, although it is too early to know what will happen and the association is studying the constitutionality of the tax increase, if the increase goes into effect sales are expected to drop around 20% in 2012. Gandini points out that there is a constitutional issue as the higher tax is actually a tax on industrialized (manufactured) goods (known as the “IPI”) (in other words, not an import tax) and as such should be equitable – that is, the same for imports and domestically made cars .

Allen Bennett – translator/editor The News in English

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