Argentina | Automotive Outlook 2024

The automotive sector once again had an outstanding performance among the different sectors of the economy despite the adverse local macroeconomic context that led to a significant increase in commercial debt with its headquarters. We expect 2024 to be a year with mixed results.

Key points

• Key points:
• Economic stagnation and FX restrictions eroded the growth of vehicle production. Nevertheless, the performance of the automotive sector was much better than that of the other industrial sectors, which were driven by exports.
• The scenario of very high inflation, negative real rates and a very high parallel FX rate in real terms maintained the attractiveness of automobiles as a safe haven of value, with a clear advantage of used vehicles over 0km vehicles.
• Domestic sales remain weak due to the effort of accessibility to a 0km. Car prices in the domestic market are in line with the depreciation of the parallel FX rate and diverge with wages measured in pesos.
• Expectations for 2024 are moderate, as although we foresee that exports will remain at good levels, the macroeconomic recovery being undertaken by the current government will not yield positive results before at least the second half of the year, causing domestic car sales (new and used) to remain depressed.

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