June 18, 2024

The popular car can come back! See how much

3 min read
The popular car can come back!  See how much

The popular car was a class of cars that won the hearts of many Brazilians in the past. The idea was simple: to offer affordable cars that fit into the pockets of more consumers. Before talking about the potential return, let’s move on to the summary of the story.

  • This part was very important for the national industry and helped automakers in times of crisis and was even used as an ally to warm up the country’s economy.
  • In the 1990s, the famous car went off forever during the government of Itamar Franco with a drop in IPI and was characterized by the 1000 engine and the lack of accessories to cut costs.
  • Sales jumped from 764,000 units in 1992 to 1,131,000 the following year, reaching record sales in 1997: 1,943,000 units.
  • To give you an idea, popular cars accounted for 71% of all vehicles sold in Brazil in the mid-1990s.
  • Among the more well-known representatives, we have Fiat’s Uno Mille and Volkswagen’s Gol (both of whom retired at the end of last year).
  • As a few decades went by, popular cars became more expensive and lost their status to so-called “popularity premium,” such as models like the Volkswagen Polo, Fiat Argo, and Chevrolet Onix.

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The Kwid Zen is currently the most affordable car in Brazil. Photo: Disclosure/Renault

In the early 1990s, the popular car cost around $7,000. Corrected, this day is equivalent to R$35,000. Today, Brazil’s least expensive 0 km model is the Renault Kwid, which although more modern, safer and better-equipped, costs almost twice as much (R$68,190).

The good news is that there is a movement gaining steam to bring the idea back to boost sales.

How much does the car cost and what will the new popular car look like?

According to information from Newspaper, the offer will not be as attractive as it was in the past from a price point of view. The promise is the new cars that start at R$50,000, with a 1.0-liter engine and run only on ethanol, which is considered a greener fuel than gasoline.

The initiative is currently under discussion at the Ministry of Development, Industry, Trade and Services. To lower prices again, one of the government’s plans is to adopt the same strategy as in the past, i.e. to cut taxes.

Stellantis defends the idea

Stellantis president Antonio Villosa supports the return of the popular car. The executive recently defended that the class will need lower taxes, but it can’t give up safety elements to cut costs.

As an example of recent popularity, Filosa mentioned the Citroën Ami compact electric car, a small car sold in Europe.

Stellantis CEO mentioned the Citroën Ami compact electric car as an example of a recent popular car. Image: Disclosure/Citroen

We’ve already talked about Ami here. The “van” only carried two people on board, didn’t need a trunk, and was a vehicle thought to run in the city, something that probably doesn’t work well for many buyers in Brazil.

Filosa says Fenabrave, the entity representing car distributors, could lead negotiations for a popular return to the country, while Anfavea, the car manufacturers’ association, notes the project should meet resistance.

With margins tight in the post-pandemic era, many automakers don’t want to sell cars cheaper, even though offering a broader range of models could improve sales in the long run.

When will the new popularity arrive?

At the moment it is difficult to say, since there is a long way to go until new agreements are signed for the project to finally begin or not. However, just having it on the agenda is good news.

Feature image: Antonio Salafieri/Shotstick

with information from bindingAnd vrumAnd flat outsideAnd car business

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