Sao Paulo — Argentinian automotive producers could increase their combined 2017 output by 20% over last year, sources said Monday.
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While the Argentinian auto industry has been negatively impacted by neighboring Brazil's economic crisis, bringing down imports from Argentina, output is expected to increase in the second half of the year, sources said.
"The outlook is positive and we expect an increase in the market for at least 15%, which could reach up to 20% in output," said Joachim Maier, president of Argentina Adefa automotive industry association, in a statement.
Maier met with Argentinian President Mauricio Macri in the International Motor Show in Buenos Aires last week and asked for less taxes and more competitive freight costs.
"The steel chain is expecting a rebound in the automotive sector to begin in the second half of the year due to incentives announced by the state, and investments to come," said one large domestic distributor. "Flat steel demand has been driven by the agriculture industry machinery, and car making could be an option to drive demand up again."
In March, Argentina's government announced a plan to boost the country's automotive sector and generate output of more than 1 million units by 2023.
The initiative includes investments of $5 billion over the next two years, the creation of 30,000 jobs and a 35% increase in national auto parts output.
In the first five months of the year, Argentina produced 173,908 vehicles, down 4.6% from 182,383 units in the same period a year ago, the association said.
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