Automotive activity has fallen 27 percent so far this year and the terminals began to apply voluntary retirements and early retirements, in addition to reducing production shifts. The general secretary of SMATA, Ricardo Pignanelli, assured that the sector “is very, very bad.” “Last year 580,000 units were produced and this year the best scenario is 330,000 or 350,000 units. This is a drop of more than 27 percent.“said the leader in statements to El Destape Radio.
“The problems are that there is no consumption. Added to this are the problems of entering auto parts that supply directly and small parts that supply SMEs to make up the national content. All of this is a combo that does not stand up to any analysis. Never, in my 47 years in the industry, plus 12 years that my old man was there, have I ever seen a crisis like this. Not even on a social level,” said the union member.
Faced with this situation, the union member assured, “We are getting by with early retirements, at 58 or 60 years of age with 30 of contributions and voluntary withdrawals“. “General Motors has problems with its auto parts. Toyota lowered production from 185,000 to 165,000 units. Ford is the only one that maintained production because it produces for export,” said the leader.
Pignanelli expressed skepticism about the impact of the bases law on economic activity and, particularly, on employment. “What there may be is an influx of capital for mining, oil and the countryside. In the value chain, if there is no added value and the primary products are gone, the work will not be contemplated. I don’t see it going to spill into work“said the leader.
The head of SMATA tried not to confront the position of the CGT, although he noted his differences regarding the forceful measures applied by the labor union. “The industrial unions took the position together supporting the decision of the CGT, which later did not take it. But, in this situation, the worst thing is to divide“, he stated in reference to the absence of the union entity in the streets during the treatment of the Bases Law, which was accompanied by fierce repression.
The situation of the automotive companies
The automotive sector is one of the hardest hit, with a year-on-year drop of 27.9 percent. Other sectors, such as cement shipments (-27.1 percent) and agricultural machinery patents (-22.9 percent), have also suffered significant decreases. The demand for electrical energy from Large Industrial Users fell by 11.3 percent, and trade with Brazil showed a decrease of 42.8 percent in imports and a 3.9 percent in exports.
Due to the drop in demand and parts supply problems, six automakers decided to stop production at their plants on the two business days of this week.. Since Monday was a holiday and the same will happen next Thursday and Friday, these terminals will not have activity throughout the week.
The sale of imported cars is expected to increase in the coming months, reaching seven out of every ten sold, displacing national production units from dealerships, according to industry estimates. The mix of domestic and imported cars reflected the equation of profitability over the possibility of access to the market, in such a way that the terminals favored importing less but of automobiles with high unit value, where the highest profitability is concentrated, while they completed the offer with the lines locally produced.
That was the main reason why B-segment cars disappeared from dealerships, compact vehicles that are characterized by being easy to handle, economical and versatile. These cars are the ones that will begin to be seen in dealerships in the second half of the year, if everything goes well as the government hopes and they manage to get through the June/July crisis, when payments in dollars accumulate.
The automotive companies concentrated in the country the production of high-value-added units, especially the mid-segment pick-ups, where Toyota leads with the Hilux but Ford is also strong with the Ranger and Volkswagen with the Amarok, which is soon to present a restyling to modernize it. Even Renault has its pickup, the Alaskan. All vehicles that they export and that allow them to have high profitability in the local market.
