BUENOS AIRES - In the aftermath of the political and economic situation under the former military government in Argentina, far-reaching reforms have brought about a return to commercial stability in the region.
Between July 1996 and July 1997, the country experienced a general price rise of just 0.6 percent, one of the lowest inflation rates in the world. And a one-to-one peg between the peso and the U.S. dollar has provided a protective cloak against the economic gloom that has descended on the rest of Latin America.
It all depends on how thick that cloak is when the climate worsens. Although the vehicle market was up 12.1 percent through September to 343,690, the September signs were ominous.
Sales for the month were down 15 percent over the same month a year ago, with every manufacturer but Mercedes-Benz taking a hit.
The market had been forecast to grow 10 percent this year to 460,000, but most companies now believe sales will remain static. Fiat held market leadership with 20.1 percent, followed by Ford with 17.9 percent; Renault, 17.3 percent; VW, 15.1 percent; Peugeot, 8.3 percent; and General Motors, 8.1 percent.
That ranking will change dramatically this year, however, reflecting GM's strong push into the market.
GM has targeted a 14 percent share for 1998 - most of it from conquest rather than market growth - thanks to the start of local Corsa production at its new $350 million plant in Rosario.
'I don't think any company can expect to have a 20 percent share of this market in the future,' said Ricardo Gravenhorst, sales director for GM de Argentina.
'We believe 17 percent will be enough to secure the No. 1 position in the future. But we have to be aware that there will be more competition from companies such as Chrysler and Toyota as well as other foreign manufacturers.'