AMDA Presents Measures to Cope with COVID-19By Alejandro Enríquez | Fri, 03/27/2020 - 12:16
AMDA urges the federal government to set an agenda on how to help the sector to recover from the COVID-19 situation.
Several states such as Jalisco, Queretaro, Guanajuato, Sonora, State of Mexico, Michoacan, Mexico City and Nuevo Leon have announced their own economic strategies to keep companies running amidst COVID-19 scenario. However, according to El Financiero, if measures to prevent COVID-19 in Mexico are extended for over 30 days, at least 100,000 new vehicles will not be sold. AMDA's Director General, Guillermo Rosales, pointed out that "the most delicate part will not be during the parabasis, but the response capacity afterwards."
In 2009, car sales in México dropped by more than 26 percent. "Starting 2020, we expected the industry to contract by 2.7 percent. We can use the stock we saved in March later in April. However, if social distancing and new restrictions emerge, after a month without sales we might be experiencing a 7 percent drop," said Rosales.
If social distancing and new restrictions emerge, after a month without sales we might be experiencing a 7 percent drop."
In a press release, AMDA presents the different suggestions dealerships propose to the federal government. As public policies, they propose different credit schemes to ensure liquidity, differentiated subsidies for vulnerable population segments and to speed up tax rebates, to name a few. As tax incentives, dealerships propose a waiver in payroll taxes, an extension to the annual tax declaration that usually takes place in April, as well as an immediate tax deduction for investments.
AMDA foresees post-contingency measures such as the renovation of public transportation and company's fleet, as well as a different tax scheme, will boost vehicle sales.
"We understand that the state calls for public and private sectors to make a joint effort to cope with immediate challenges. From our sector, we propose what has been stated above with the sole objective of building trust that guarantees employment, while diminishing the economic and social impact of the emergency the world and our country are experiencing," said Rosales in the statement.