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ReportsnReports.com: Consumer Electronics in Argentina
Euromonitor International’s “Consumer Electronics in Argentina” is now available at ReportsnReports.com.
Cutting edge electronics are in demand
2010 was the year of CCFL LCDs, smartphones and netbooks despite high inflation rates. LED TVs, smartphones, netbooks and tablets are also expected to be in high demand in 2011. Overall, consumer electronics products will see a healthy market development during the forecast period and will feature new adoptions and technology migration. Consumers are likely to sustain the growth curve during the forecast period with a next high peak in 2014.
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Sporting events drive demand
A highly positive spirit driven by the FIFA 2010 World Cup, rise in wages, and flexible payment terms defined the Argentina consumer electronics market in 2010. The FIFA World Cup hosted in South Africa during the year was the single most influential event of the year as sports enthusiasm motivated consumers to adopt the latest television technologies. This was due to the high expectations surrounding the performance of the la Albiceleste (sky blue and whites), a popular name given to the Argentinean national team, which included Lionel Messi, FIFA’s world player of the year in 2009 and 2010. Argentineans were encouraged to consume as wages were increased and highly flexible payment options were provided on purchases of electronics. In addition, Argentina hosted and won the 2010 Women’s Field Hockey World Cup. Both of these sporting events enabled all leading brands to achieve record sales. Several other key sporting events will help the adoption of consumer electronics.
Local production is on the rise
Non-automatic import licensing and high import duties among others challenged brands’ business plans, driving them to invest in local production based in Tierra del Fuego. Local production is obtained through acquisitions and strategic partnerships and is mainly focused on reduction in taxes for locally produced products. In February 2011, the restrained portfolio of consumer electronics products was expanded to include notebooks, netbooks, mobile phones, and others. The government aims to turn the southern province of Tierra del Fuego into a competitive production hub, much like the tax-free Manaos in Brazil. However, import restrictions remain a major challenge and are a key driver of high inflation rates.
Government encourages consumption
The last major credit crunch was in 2001-2002 with a strong devaluation of the local currency, which was again slightly hit at the end of 2008 by the global financial crisis. Since then the government has attempted to spur consumption by consistently pressuring banks to increase their offerings of flexible payment options that include discounts of 20% and up to 50 interest-free instalments. Thus, 2010 achieved new growth records in the sale of consumer electronics and also promises great results for 2011 and throughout the forecast period.
Digital transmission launches
The state-owned Channel 7 featured the first digital transmission of the 2010 FIFA World Cup in Africa, which it did in association with the Japanese-Brazilian ISDB-T digital television standard. The government is currently working on generating awareness of the new television format while developing the local infrastructure to expand the signal’s reach through locally produced equipment. Cable operators also already offer HD television, promoting specific value-added services. This new move is likely to significantly drive sales of home and portable electronics as a whole.
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