Mensajepor Mr_Baca » Mar Jun 05, 2012 1:18 pm
DJ Argentina May Car Sales Rebound as Buyers Seek Inflation Hedge
--May car sales hit new record amid high inflation
--Cars seen as safe bet against inflation, peso depreciation
BUENOS AIRES--Argentina's new vehicle sales jumped in May as residents flocked buy a durable good amid high inflation and growing fears of a rapid deterioration of the peso.
Sales in May set a new record for the month, hitting 75,824, the car dealer association Acara said Monday. That's up 11.5% on the year and 25% on the month.
"Faced with the lack of attractive options in the financial sector, more and more are deciding to buy a vehicle because it's a good that holds its purchasing power," Acara president Abel Bomrad said in a press release.
Argentines have historically invested in real estate and consumer-durable goods like cars to protect the purchasing power of their savings during times of high inflation.
Most private-sector economists say inflation is rising at an annual rate of over 20%.
In addition, the government has taken some draconian measures lately to stem heavy capital flight. The government now vets all requests by businesses and individuals who want to buy foreign currencies, rejecting most and slowing official dollar buying to a trickle.
The dollar scarcity has fueled a black market where Argentines can obtain the U.S. currency at a hefty premium over the official exchange rate.
The black market rate was about ARS5.80 to the dollar Monday, according to financial newspaper El Cronista. In stark contrast, the peso weakened to ARS4.4745 on the local MAE wholesale foreign-exchange market compared to ARS4.4705 on Friday. B===D
"With regards to the exchange-rate aspect, there haven't been big changes at the dealerships because cars are always sold in pesos," Bomrad said.
The strong sales in May follow very weak sales a month earlier. Vehicle sales in April were down 8.3% on the year at 59,958, due in part to fewer business days.
During the first five months of the year, vehicles sales were up 7% on the year at 389,909, according to Acara.
Auto dealers and car manufacturers saw record sales last year amid brisk economic growth of 8.9%.
However, growth is expected to cool to a 6% annual rate this year, according to the central bank, an estimate private economists say is optimistic. Many economists are predicting flat growth or even a contraction this year.
In addition, demand for vehicles from Brazil, the largest market for Argentina's exports, has fallen sharply.
Vehicle exports in April slumped to 30,442, down sharply from 42,244 a year earlier as Brazil cut back buying, car makers' chamber Adefa said last month.
Brazil buys over three quarters of Argentina's vehicle exports. During the first four months of the year sales to Brazil were down 25% on the year at 87,505 vehicles.
Argentina's vehicle production plunged 24% on the year in April to 54,772.
