translated from Spanish: Auto part sector: declines in activity and the “threat of Chinese parts”

the automotive sector is one of the areas most affected by the crisis affecting our country. Sales have plummeted and production does not reach the same volumes from the previous year to date. Now is the Association of factories Argentinas component (AFAC) which reflects from their perspective the hard reality that the auto parts industry. Among the main problems that warn from the sector, 39% go to the fall of activity, either both for the replacement market, or in the provision of parts for the terminals automotive, as one of the biggest challenges, according to a report submitted by the Association. From AFAC warn about the origin of imports, which mainly come to China as a problem, with 32%, and Brazil, with 36%. Mexico and the European Union followed, with 16% and 6% respectively, relating not only to the companies suppliers of terminals but also to the replacement market. 18% of the auto parts sector also said taxation as another delicate factor. It should be recalled that in 2018 the second argument had focused on the lack of competitiveness at the macro level. Followed with 14% of the responses the negotiation of prices with customers, since some automotive policies have an impact on the financial situation of suppliers and produce a reaction chain. The lack of competitive financing, with 11%, also is calling for attention from the auto parts. Below has been the concern about non-wage labour costs and labour regulations, with 10%. But also the lack of access to inputs with international costs has been 5% of responses. All of these indicators have clearly left the difficult situation in the sector. Since the accord with the Government a minimum of 40% of domestic parts for vehicles manufactured locally with plan ‘a million’ (which is to develop a million vehicles a year) to suffer withholding exports since December. In this note:

Original source in Spanish