SAN ANTONIO, Texas — Despite the automotive market's current boom times in Mexico, that sector declined overall in Latin America in 2016, according to research firm Frost & Sullivan, but is expected to rebound.
A report published March 16 by the San Antonio-based company on the Latin American passenger vehicle market outlook for 2017 notes that digital transformation is “expected to propel growth across the entire automotive value chain,” with the result pushing sales volumes upwards of 5 million units.
Frost & Sullivan said that senior management and CEO-level executives in the Latin American automotive value chain cited “as-a-service” models — focusing on the future of connected cars and harnessing “big data” to better serve consumers — as the two biggest themes and top-of-mind-issues in the passenger vehicle market today in that region.
However, it added, the Latin American automotive market declined by about 3.5 percent in 2016 to account for just below 5.0 million units.
While Brazil witnessed a decline of almost 20 percent, dropping below the 2.0 million units mark, Frost & Sullivan reported that Mexico had a record year, producing more than 1.6 million vehicles. In addition, Argentina and Chile “returned to the growth trajectory” in 2016.
Competition for the top spot among vehicle-producing countries intensified in 2016, it said, and the year witnessed a number of market share changes while also marking a key trend of shifting away from cars and towards SUVs.
As a part of its outlook study, Frost & Sullivan said it identified the key disruptive trends that will shape 2017 in the Latin America passenger vehicle market, including:
• Digital transformation of the industry;
• Technology innovation and regulations;
• Growing vehicle segments;
• The start-up boom in Latin America;
• OEMs entering the mobility landscape;
• Market differentiators, including standard and advanced vehicle features;
• Used cars; and
• eRetailing and how it will change the face of the aftermarket.