Instead of giving buyers free projectile weapons, Argentina is now requiring distributors to guarantee export of various supplies, including wine, chicken feed, and peanuts, to secure access to the country's booming auto market. The new deal comes just after re-election of president Cristina Fernandez de Kirchner.
Porsche's distributor, Hugo Pulenta, for example, has agreed to export wine from his family vineyards in exchange for the permits needed to bring the German sports cars into the country. Subaru's distributor will be sure chicken feed is sold to offset its imports; Mitsubishi's will export peanuts.
The move, odd as it may sound, makes great sense: as Argentina's car market heats up, growing as much as 30 percent annually, it's worried heavily about its trade surplus.
Yes, that's right, unlike the United States, which runs a heavy annual trade deficit, importing far more than it exports, Argentina sold about $12.1 billion more than it bought in 2010. It fears that could drop by as much as one-third over the next year without some protective measures, reports Automotive News (sub. req.).
Bargaining for permits means auto importers will have to match, dollar-for-dollar, exports with cars brought into the country. That's a whole lot of wine, peantus, and chicken feed, and that problem is being felt sharply, particularly at the luxury end of the market.
While luxury distributors complain, however, Argentina expects the auto industry to run a surplus of $844 million due to the new regulations.