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12 FROM THE TOP » CARLOS ZARLENGA, GM March 2018 | AutoData tomotive industry in Brazil? We speak of a number around 50%, it is one of the largest in the world. So when we talk about tax benefits for the automotive industry, when looking at the whole pa- ckage, the whole bill is not a big diffe- rence. The point here is that all elements are linked: energy efficiency is tied to an investment that has to be done, which was thought within the investment that the government also makes to deve- lop the technologies, as happened in Inovar-Auto. If you take one part and do not take another part, everything has to be rethought. In Innovating the industry generated R$ 40 billion in investments and the corresponding part of the gover- nment was very small compared to that. What is the projection of GM Mercosul production growth for 2018 compared to 2017? 22%, from 517 thousand units to 630 thousand, or just over 100 thousand addi- tional units fromone year to the next one. We are growing in market share in Brazil and Argentina, even in the fourth quar- ter of last year we have already grown above the industry average. In October we estimated a total market of 2.4 million to 2.6 million, and we are now growing from 2.5 million to 2.7 million, and quite close to 2.7 from 2.5. What is the reason for this new expec- tation? First: January. It is a record not to forget. It was a very strong month compared to what we expected. December was equally strong, just like November and also February. Consumer confidence continues to grow, we have not had a month of reduction of this index since July 2016. Second: a series of launches have happened, really new things in the market. It is not only a car exchange for another one equal to 0 KM, they are really new products, evolutions that did not exist before. This creates a willingness in people to return to themarket. Third: The expectation of employment is better, this has an important impact. There is less apprehension in people about losing their job. In our surveys the consumer is confident to make an investment on a new car. What explains this increase of reliability even in the present circumstances? If you’re a GM employee, you’re a little more confident today than you were in 2013. The worst is over, in the end that’s what everyone believes. Andmonth after monthwe keep seeing the market grow. The most interesting thing is that people usually evaluate the growth in volume, in units, but if we make an analysis in Reais we will see that the evolution is much bigger, even discounting the inflation. The old products were all replaced by models with much more technology, with a much higher average ticket. So the industry’s growth in Reais was much higher than in volume last year. The con- sumer has spent more to buy better cars, withmore technology, more content, etc. Did this help the profitability? We improved a lot. We report a much better 2017 than 2016 but with almost similar volume, very close, with little growth. Anyway, we are below what we have already reached as a peak. One important factor is that we have greatly lowered the company’s balance during the crisis, which should work for this year and next year as well. In 2013 we reported balance in South America, 2014, 2015 and 2016were years of losses and 2017 we returned to break even after three years. “The first thing needed to understand the autonomous car business model is to produce an autonomous car”