Automobile production in Brazil rose in August, though the slight gain may not offset concerns of an industry crisis due to the sluggish local economy, according to a Reuters report.

Car and truck production rose 5.3 percent and sales fell 7.6 percent from July, national automakers' association Anfavea said in recent presentation. Output dropped 22.4 percent from a year earlier, though, while sales slid 17.2 percent, according to the Reuters report.

Brazil's auto industry, which makes up a fifth of the country's manufacturing output, has slashed production this year as sales lag. Anfavea reiterated an earlier estimate that production would drop by 10 percent in 2014 from the previous year, while sales would fall 5.4 percent, according to the report.

The Reuters report also noted the industry has seen drop in exports. In August, exports fell 50.6 percent from a year earlier and are down 38.1 percent for the year. Total exports for 2014 totaled 235,400 vehicles, Anfavea said.

Anfavea President Luiz Moan predicted that the industry should see improvements during the second half of the year citing a recent decline in interest rates for auto loans, according to Reuters.

Brazil is the world's fourth biggest auto market and a major base of operations for Italy's Fiat SpA, Germany's Volkswagen AG and U.S.-based General Motors Co and Ford Motor Co.

Originally posted on Automotive Fleet