The MNC Index falls in the second quarter, a reflection of the cooling of economic growth in key markets, as well as weakening currencies in the region.
By David Ramirez
Latin Business Chronicle’s Multinational Index for the second quarter of 2014 reveals a disappointing performance for the top 25 multinational companies (MNCs) operating in Latin America. According to the index, the total revenue generated in US dollar terms by these MCNs in the region fell by 7 percent compared to the same quarter in 2013, to US$60.8 billion. This reflects the cooling of economic growth in key markets, such as Brazil, Mexico, Argentina and even Chile, as well as weakening currencies in these and other nations throughout the region.
The headwinds were particularly strong for carmakers. US-based Ford’s revenue from the region plummeted by 30 percent, chiefly reflecting the weakening of the Brazilian real, the Argentine peso and the Venezuelan bolivar, together with the shutdown of operations in Brazil during the Soccer World Cup. Similar factors hit competitors Volkswagen (Germany) and Fiat (based in Italy, but owned by US company Chrysler), whose Latin American revenue went down by 23 percent and 19 percent, respectively, in year on year terms.
Household appliances’ manufacturers also experienced woes in the region. For example, the revenues from Electrolux (Sweden) and Whirlpool (US) fell by 26 percent and 11 percent year on year in the second quarter, respectively, …
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