Blog Posts by Augusto Amorim

Nissan Targets 5% of Brazil Auto Market Share with New Facility in Brazil

Nissan just opened a new plant in Brazil, with capacity to make 200,000 light vehicles per year. Nissan has built the Livina/Grand Livina MPVs and the Frontier pick-up in a plant owned by Renault in the southern part of the country. With the new facility, they will make the March and Versa in Brazil. Previously, they were imported from Mexico, but when Brazil set limits on vehicle imports from Mexico in 2012, they had to change their strategy. The new factory, which was built in 36 months,...
Read More »
1 Comments »

When Porsche Outsells Other German Luxury Brands in Brazil

Do you think a Jeep Grand Cherokee is a direct competitor of a Porsche Cayenne? Would you add the Volkswagen Touareg to the competitive set? Well, many Brazilian consumers do. And the results may be surprising. Let me start with the winner in the SUV/crossover segment. Land Rover is the preferred brand. The Range Rover Evoque sells over three times more than vehicle number two, the Volvo XC60. And the Freelander (LR2 in the U.S.) comes right in third place. Looking one length class above, the......
Read More »
0 Comments »

Which Vehicles Topped Google's Search in Brazil?

When Google released its Zeitgeist 2013, a compilation of the most googled terms of the year, the Hyundai HB20 reached the top spot for the Brazilian automotive industry. It was followed by the Chevrolet Onix and Chevrolet Prisma. The new Volkswagen Golf and the Volkswagen Beetle (locally called Fusca) rounded out the Top 5. The HB20 hatchback, the Onix and the Fusca were launched late in 2012. There is no doubt the HB20 has written its success story in Brazil’s automotive history. With 3,312......
Read More »
0 Comments »

How Quickly Should an OEM Phase a Vehicle Out?

I always think about the title of this post – how quickly should an OEM phase a vehicle out? – when I analyze Chevrolet’s numbers in Brazil, the second market for the brand just behind the U.S. Before I get to the figures, let me give you a quick background. Traditionally, Chevrolet had sold rebadged Opel models in Brazil: Monza, Corsa, Zafira, Meriva, Astra, Vectra. During GM's Chapter 11 time, no investments were made in Brazil, which got Detroit's approval of using local revenue to develop......
Read More »
1 Comments »

Will Automotive Luxury Brands Succeed in Brazil?

Do you have the impression that the Brazilian president meets the CEO of an automaker daily? Lately there have been a lot of announcements that OEMs will start – or resume – production in Brazil. This year, Honda and Mercedes-Benz announced new plants, while Audi stated it is coming back to Brazil and making cars in a VW plant where it built the A3 some years ago. VW confirmed it is finally updating the locally made Golf (currently still in its fourth generation). Last year, BMW announced its......
Read More »
2 Comments »

Farewell to Brazil's Oldest Vehicles

Brazil is waving goodbye to some of its oldest vehicles. Not because OEMs have decided to drop them or because customers were not going to the dealer network looking for them, but because all vehicles sold in Brazil beginning January 1, 2014 must have ABS and airbags. And some last-longing models simply cannot comply with the rules. That is the case of the Volkswagen Kombi, known as the Transporter T2 in the country. Made in Brazil for the past 56 years, it was the first vehicle assembled...
Read More »
0 Comments »

Is there any Logic to Argentina's Auto Market?

If you follow my posts, you have read that there is not much logic in Brazil's automotive market (if not, you can follow the link at the bottom of the blog). Today, I will show that neighboring Argentina faces the same problem. Argentina is struggling with inflation. Last year, inflation was 10% according to the government, but opposition in Congress says it was 25% – the highest rate in South America and only behind Venezuela. The government is known for reporting lower inflation and higher...
Read More »
0 Comments »

Is There any Logic to Brazil's Auto Market?

Several protests took place in Brazil during the month of June. Everything started with public transportation fares that were increased, although the increases were less than $0.10. And even after the increase was cancelled, protests kept going on, focusing on corruption, the amount spent to build stadiums for the World Cup, poor educational and health systems despite high taxes, amongst other things. (For more about the protests, see the links at the bottom of the blog.) Ironically, protests......
Read More »
0 Comments »

Exports Hurting Production in Brazil

Tax incentives were very effective in 2012 and helped Brazil reach a new sales record of 3,573,076 light vehicles. With this success, Brazil remained the fourth largest automotive market in the world, just behind China, the United States and Japan. Polk's automotive forecast does include any changes in this ranking in 2013 when sales in Brazil are anticipated to reach 3.63 million light vehicles. However, Brazil's importance declines when we analyze production numbers. Last year, production...
Read More »
0 Comments »

How Used Cars Are Hindering Mexico's Potential

Since January, Mexico has been able to import American and Canadian vehicles that are Model Year (MY) 2007 or older. Up until December, the limit was MY04 or older and in 2009, it was MY99 or older. In 2019, any used vehicle can be imported from the U.S. and Canada, regardless of its age. This is not a new problem: in 2006 and 2007, Mexico imported more used vehicles then it sold new cars. Although the imports cooled down last year, they gained strength again earlier in 2013. There was an...
Read More »
0 Comments »

Venezuela Selling 2013 Vehicles with 2009 Prices

Venezuela was all over the news last week because of the death of its president, Hugo Chávez. President Chávez passed away after a battle against cancer, which included several surgeries in Cuba. What the international media did not pay attention is to a law approved in January that affects the automotive industry. How would you react if a law determined that all new vehicles from now on should have a sticker price from the first half of 2009? Moreover, could you, the dealer network, afford...
Read More »
2 Comments »

2009 Prices in 2013

How would you react if a law determined that all new vehicles, from now on, should have a sticker price from the first half of 2009? Moreover, could you as a dealer network afford to give back to all you customers what they paid beyond those prices between then and now? This can sound like an unrealistic scenario, but is a law approved in Venezuela. The law was create after Congress inspected and questioned OEMs, dealers and independent stores and got to the conclusion that vehicles are...
Read More »
0 Comments »

Toyota Lessons Not To Follow

As Toyota announced it has regained the global sales crown, it makes me think of how the Japanese OEM has wasted its chances in the world's fourth largest market. Not everyone is aware that Toyota opened its first factory outside of Japan within Brazil in 1959, a plant that is currently used to produce parts. For decades, the Brazilian market was closed to imports and Toyota only produced a version of its Land Cruiser. It was a great product for rural areas, but Toyota was far behind its...Read...
Read More »
0 Comments »

Main Markets in South America Face Protectionism Wave

South America is a very diverse continent. Brazil, its main country, forbids diesel passenger cars and speaks Portuguese, but is surrounded by Spanish speaking countries. French Guiana still belongs to France, something not very common nowadays. Consumer behavior is also different: Toyota, for example, is the market leader in Peru and has a higher share in the countries closer to the Pacific Ocean, while customer loyalty in Brazil and Argentina goes toward brands from Europe and the United...Read...
Read More »
1 Comments »

Argentina and Mexico Reach Agreement

Late in June, Argentina canceled the free-trade agreement it has had with Mexico since 2002 (as noted in my prior blog). Argentina wanted to negotiate the agreement, as Brazil successfully did with Mexico, assigning quotas to imports but Mexico did not concede. Argentina has been consistently the fifth main market for Mexican exports since 2009, although volumes jumped 177% between 2009 and 2011. Brazil went from the fourth spot in 2009 up to second place this year, even with limits to...
Read More »
0 Comments »

Sao Paulo Auto Show: Becoming More Global

The presence of Dan Akerson, General Motors' CEO, Martin Winterkorn, Chairman of the Board of Volkswagen, Audi and Porsche, Takanobu Ito, Honda's CEO and President, and Ralf Speth, Jaguar Land Rover's CEO, shows how international the 2012 Sao Paulo auto show has become. Brazil has always been a key market for many OEMs – for example, it is the second main market for Chevrolet and Renault – but it has been closed, with many products only offered in the country and in neighboring Argentina....
Read More »
0 Comments »

Automotive Growth Challenges in Fast-Growing Regions

It was a national holiday in Brazil on October 12 and I went with my family to where my father was born, a small town where approximately 10,000 people live today. During the long weekend, my impression was that Chevrolet was the best seller in Brazil, but actually it falls behind Fiat and Volkswagen. However, I saw more of the Chevrolet Montana (a pick-up truck based on a passenger car, something that Brazil created decades ago) and the S-10 (the local name of the Colorado) than the Fiat...
Read More »
1 Comments »

BMW's Chance to Grow in Brazil

I arrived in my hometown of Sao Paulo, Brazil yesterday and thought for sure that I would see a couple of Volkswagen Gols with their new facelift, which was announced in July. The Gol has been the best-selling vehicle in Brazil for 30 years and in the past, I have always seen a new generation or facelift on the streets as soon as they were announced. However, to my surprise, yesterday was different: I didn't see a new Gol. At the airport parking lot, there were two EcoSports – the crossover...
Read More »
0 Comments »

Two Hyundais, One Market

At this point in automotive history, nobody denies the importance of Hyundai. According to Polk data, the Korean OEM produced almost 3 million light vehicles worldwide in 2003 and we forecast that its output will reach 8.3 million in 2016. That's a growth of 183%, while on the other hand, GM's production is rather stable during the same period. Part of this growth will come from a brand new factory in Brazil. With an investment of $600 million, Hyundai will start producing a hatchback on... Read...
Read More »
0 Comments »

Audi's Second Factory in the Americas

There is a lot of buzz about the Audi plant that will be built in San José Chiapa, Mexico. The press refers to it as "Audi's first car plant in the Americas," but this is not correct. Audi produced the A3 in São José dos Pinhais, Brazil between 1999 and 2006, in a factory now totally owned by Audi's parent company, Volkswagen. Golf (still in its fourth generation), Fox and SpaceFox are produced there. It was a joint venture between Audi and Volkswagen – Audi had 25% of the factory.The A3...
Read More »
0 Comments »