The car rental sector increased relevance for Brazilian automakers has raised
questions on the trade-offs born out of this relationship. Using the covid-19 pandemic
as a natural experiment setup and the differences in differences methodology we find
that car models that are often sold to car rental companies faced higher depreciation
relative to retail-oriented car models during the pandemic. We also find that new car
prices behaved similarly for both groups. These results suggests that the trade-off for
car manufacturers is limited.
