Auto parts production in Córdoba fell 67% year-on-year in the second quarter

Despite being out of quarantine, the metal industry is struggling to recover.

Auto parts production in the second quarter, according to data up to June 20, averaged 66.9 percent below the same period in 2019, a year that was not good for the sector either. All in all, it closed with 68.4 percent of its active staff.

The foundry and refinery sector registered somewhat worse indicators: an activity level 68.5 percent below the second quarter of 2019 and 39 percent of its active workers.

In the same period, the only one that showed positive indicators is agricultural machinery, which closed the second quarter with a production volume 8.1 percent above the April-June period last year, with 95.9 percent of its campus working, since part of its employees integrate risk groups.

The data, which belong to the Córdoba Industrial Activity Statistical Monitor, were reported today during the presentation of the Córdoba Metallurgical Activity Observatory, both prepared by the Economic Trends consultancy.

The Observatory, prepared for the Córdoba Chamber of Metallurgical Industries and Components (Cimcc), showed that the Business Confidence Index for this sector in the first quarter fell 18.9 percent year-on-year and 40 percent in the last three years.

According to the businessmen, of the four large markets of the Cordovan metallurgical industry, only agricultural products maintain a positive outlook. The automotive chain, the oil industry and construction are on the decline, as a direct impact of the quarantine due to the Covid-19 virus.

“Production levels are very low. A lot of companies are renegotiating debts, meeting with their creditors to see how they can pay what they owe, because there is the feeling that we have not yet hit bottom, “said Eduardo Borri, president of the Cimcc.

An example is what happens in the production lines of Fiat Chrysler Automobile (FCA), Renault and Nissan, whose production plans for the rest of the year are 35 percent below last year, as he warned. For now, among the few encouraging news reports is that in August Iveco resumes manufacturing and that in November the Japanese company will begin manufacturing the Renault Alaskan van.

Low expectations

This situation was directly reflected in employment: 33 percent of the surveyed companies reduced their staff in the first four-month period and 21 percent plan to end the year with fewer workers.

In the same period, 60 percent had less production in the January-April period and 55 percent plan to end the year.

As for profitability, it fell for 71 percent of respondents and will end below the end of the year for 68 percent.

It happens that 48 percent have negative expectations about the future situation of the Argentine economy.

The Observatory also surveyed national government industrial policy thinking, according to which 47 percent thought it was bad, 34 percent fair, and seven percent good.

Opinion changes around the industrial policy of the provincial government. For 29 percent it is positive, for 45 percent it is fair and for 18 percent it is bad.

According to the survey, in April 65 percent of companies used the national government programs to cover wages, while in May only 40 percent did.

When asked about the evolution of the economy once the pandemic subsides, 44 percent said it will improve, 17 percent will remain the same, and 33 percent will worsen.

In this framework, 44 percent think that they should make changes in the production processes of companies; 43 percent will have to change markets, customers or their products and 30 percent considered that they should put 4.0 technologies.

When asked about the Vicentín case, seven out of 10 Cordovan metalworkers expressed the opinion that Governor Juan Schiaretti should ask the deputies to vote against if the National Executive sends Congress an expropriation project.

43.4%

In the first four-month period of the year, for metallurgical industrialists, the competitive exchange rate for the sector should be 43.4 percent above the official price. This is due to the difference with the informal market values ​​and the devaluation of the Brazilian currency.