Thursday, January 21, 2010

Car Makers Hope is Brazil: Ford Has Vehicle Stock For Only 2 Hours

According to the Financial Times, Brazil gives hope of growth for manufacturers of vehicles that are going through a crisis abroad. Along with China, it is one of the few countries where manufacturers can remain profitable.

In addition to good economic times the country has controlled inflation and continued growth of credit. In addition, the vehicle market is still quite outdated compared to the U.S., which means that there is lots of room to grow.

While there is "six or seven" people per vehicle in the United States the ratio is almost one to one (just 1.2 people per car).

Even so, Brazil is already the fifth largest vehicle market in the world, according to Anfavea (association of manufacturers).

In Ford's case (F) the country is the third largest market, behind only the U.S. and the UK. The company's advanced factory in Cama├žari (Bahia) does not have stock for more than two hours and already operates in strong rhythm, producing 166 vehicles per hour, 24 hours a day, six days a week.

The current situation of the Brazilian economy attracted even a Chinese automaker, Chery, which plans to invest $500 to $700 million in Brazil

Average planned investment per year for some automakers:

  • Fiat: R$1.8B in 2010 (including Argentina)
  • VW: U.S. $1.24B (U.S. $6.2B up to 2014)
  • Peugeot Citroen: $0.9B in 2010
  • Ford: $9.8B ($4B 2011-2015)
  • Renault: R $333M (U.S. $1V 2010-2012)

(Reported by O Estado de Sao Paulo).

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