Latin America Market
worldwide. While production volume has fallen since 2014,
market analyst IHS forecasts a 13 percent growth in Brazilian
production this year.
Among new investors in Brazil’s auto industry, Gestamp will
open its seventh plant in Brazil, in Betim, Minas Gerais State, to
supply Fiat Chrysler domestic needs.
On a more negative note, Venezuela has dusted off its expropriation practice, seizing General Motors’ assembly plant in
Carabobo State, in April, on claims that it was idle and thus not
contributing to the economy. GM closed the plant and laid off
2,700 workers. Venezuelan auto association Cavenez reported
a production drop in autos during 2016 of 84 percent to 2,849
cars nationwide.
During growth years, the consumption of architectural paints
typically grows one or two percentage points faster than GDP,
since consumers in the region take pride and find solace in a
fresh coat of paint. However, the GDP of Latin America and the
Caribbean contracted by 1.1 percent in 2016, which translates
into a 2.2 percent decline in per capita GDP, ECALC calculates.
Within the region, Central America experienced the stron-
gest sub-regional per capita growth, at 3. 5 percent. Mexico, too,
saw per capita expansion at 2.0 percent. This bodes well for
companies well-positioned in the region, like PPG’s Comex unit,
and Sherwin-Williams, which has an aggressive company store
campaign underway. Colombia also saw 2.0 percent growth,
Brazil’s per capita GDP dropped 3. 5 percent, and in neighbor-
ing Argentina, it was down 2.0 percent.
The demand for paint and coatings in the industrial sector
declined over the past year, as exports dropped off. ECLAC
noted that, “In industry, the manufacturing contraction that had
begun in 2014 deepened as domestic demand deteriorated.”
The slowdown in the industrial segment is a compound
equation, affected both by exports and internal consumption.
“The export slowdown brought a drop in output in the indus-
trial sector (- 3.0 percent) in the first half of 2016, and this was
compounded by a fall in service-sector output (-1.2 percent),
mainly because of the decline in commerce (-1.8 percent), re-
flecting lower private consumption,” ECLAC details.
Among the Latin American countries with the highest pre-
dicted growth rates this year, the Dominican Republic expanded
at 6. 4 percent last year and should grow by 6.2 percent this year,
analysts predict. Several Caribbean islands are demonstrating
positive growth ahead of Central and South America. St. Kitts
and Nevis, for example, is predicted to expand at 5. 3 percent
this year.
Lanco operates a production facility at Santo Domingo,
D.R., and is working at developing its marketing staff this year,
including more of a presence in social media. The company’s
Maxima Armor brand architectural paint is among those brands
receiving more attention.
