UPDATE: Colombia '08 Auto Sales Down 16% On-Year To 217,048 Units
20 Januar 2009 - 1:24AM
Dow Jones News
Colombian wholesale vehicles sales in 2008 fell for the first
time since 1999 as higher gasoline prices, increased interest rates
and the peso depreciation discouraged buyers from purchasing
cars.
Vehicle sales fell 16% to 217,048 units in 2008 from 2007, when
258,413 vehicles were sold, according to data released by industry
group Comite Automotor on Monday. Car sales had hit an all-time
record in 2007.
The drop in car sales is the first since the economy entered
into recession in 1999, when Colombia sold 57,257 units, about half
the 109,375 units sold in the previous year.
Nicolas Urrea, marketing director of Los Coches - one of
Colombia's largest car dealers - said the peso depreciation, higher
gasoline prices and skyrocketing licenses to operate trailers and
buses discouraged buyers.
"Colombians went crazy buying imported cars at the beginning of
the year, but when the peso began depreciating that trend changed
completely," Urrea told Dow Jones Newswires.
The Colombian peso appreciated 22% against the dollar in the
first six months of the year, hitting its strongest level in nine
years, but then it weakened following the world financial meltdown,
ending the year with a depreciation of 16% compared with December
2007.
Regular Colombians also bought fewer vehicles as gasoline prices
rose an average of 1% each month as the government kept phasing out
gasoline subsidies, Urrea added.
Additionally, the government decided to increase the amount
charged for a license to operate a new truck or bus, discouraging
even more potential buyers.
"In 2007, when a trailer was entering into the economy, the
buyer had to pay the government a license of 20 million Colombian
pesos [$8,966]. Last year, that same license cost COP50 million.
That discouraged strongly the purchase of heavy cars," Urrea
said.
Colombians also bought fewer cars last year as a result of
higher interest rates as the central bank gradually increased its
key rate - to 10% in July from the 6% of 2006 - in a bid to stop
inflationary pressures, said Arnoldo Casas, head of research at
local brokerage Profesionales de Bolsa.
In late December, the central bank cut its key rate to 9.5%,
citing the economic slowdown and changing its monetary policy.
In the four years ending with 2007, car sales rose at a pace
faster than 20% as a strong peso and lower interest rates
encouraged people to buy vehicles.
Car sales are expected to keep falling this year as Colombians
will refrain from buying a new car or replacing their old vehicles
amid an economic deceleration. Urrea expects the industry will sell
around 200,000 vehicles in 2009, down 8% from 2008.
The Colombian economy is expected to decelerate by 3%, down from
an initial estimate of 3.5%, according to the finance ministry.
"This year, Colombians will think twice before buying a car
because they're afraid of losing their jobs," Urrea added.
General Motors Corp. (GM) topped the sales rankings in 2008 with
77,754 units, down from 95,124 in 2007.
French car maker Renault (13190.FR) took the No 2. spot, as it
sold 26,845, down from 39,826 cars in 2007.
South Korean Hyundai Motor Co (005380.SE) took the No 3. spot
with 21,492 units at the wholesale level in 2008, down from 27,007
a year earlier.
Comite Automotor's statistics cover more than 90% of the
vehicles sold in Colombia, including buses, private vehicles, taxis
and trucks.
-By Inti Landauro and Diana Delgado, Dow Jones Newswires;
571-6107044 ext 1132; diana.delgado@dowjones.com
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