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Latino Daily News

Tuesday October 29, 2013

Auto Dealers in Mexico Lower Sales Expectations

Auto Dealers in Mexico Lower Sales Expectations

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Dealers are cutting their sales forecasts for this year from 1.07 million vehicles to between 1.06 million and 1.05 million units due to the uncertainty created by the tax reform package being debated in Congress and a slowing economy, the Mexican Automobile Dealers Association, or AMDA, said.

“The uncertainty and unease in society over the reforms was one of the most important factors behind the 9 percent drop in new vehicle sales in September, compared to the previous month,” the AMDA said in a statement.

“This situation, on top of the plunge in national economic growth, has led us to cut our sales estimate for 2013” by 10,000 to 20,000 units, AMDA president Guillermo Prieto said.

The tax reforms proposed by the government will “increase labor costs, reduce the purchasing power of the middle class and, with it, the possibility that families and businesses can renew the vehicular fleet,” the trade association said.

The lower house of Congress approved the tax reform legislation and it is now being debated in the Senate, where the bill faces strong opposition from the conservative National Action Party, or PAN.