SAO PAULO, Jan 5 (Reuters) - Auto sales in Brazil rose to an all-time high in 2009, capping a year when tax breaks and record-low interest rates helped the country's market remain a global bright spot for automakers despite the economic downturn.
Sales, which had plunged late in 2008 as global credit markets choked, quickly recovered after Brazil's government slashed industrial taxes on new cars and eased banking rules to spur vehicle loans.
"The measures by the government were taken because the auto sector was able to show (the economy) could grow again," said Sergio Reze, president of the national dealers' association Fenabrave.
"People just weren't buying because there was no credit," he told a news conference.
Sales of new cars, light vehicles, trucks and buses rose 16.41 percent in December from November to 293,030 units, Fenabrave said on Tuesday.
Sales in 2009 climbed 11.35 percent from the previous year to 3.14 million units, a third straight annual record.
Brazil's auto industry benefited from record-low interest rates after the central bank slashed borrowing costs by a cumulative 500 basis points in the first half of 2009, making consumer loans cheaper.
Brazil, Latin America's largest economy, is a major market for Italy's Fiat (FIA.MI), Germany's Volkswagen AG (VOWG.DE), and U.S.-based General Motors [GM.UL] and Ford Motor Co (F.N).
Fiat led sales again in 2009, with a 24.49 percent market share, followed by VW with 22.74 percent and GM's 19.79 percent share of sales last year, Fenabrave said. Ford ranked fourth and Japan's Honda Motor Co (7267.T) fifth in terms of sales, with 10.1 percent and 4.18 percent, respectively.
Fenabrave forecast sales of cars and light vehicles to rise by 9.73 percent in 2010 on the back of Brazil's economy, which is expected to rebound strongly this year.
"Our forecast is based on a consensus scenario where the economy expands 5 percent in 2010," Reze said, adding that sales in December were the best for that month since the association began keeping industry figures in 1957. (Reporting by Alberto Alerigi Jr.; Writing by Elzio Barreto; Editing by Maureen Bavdek, Leslie Gevirtz)