The 26% year on year growth in Brazilian vehicle sales in the first half of 2007 has prompted important changes at several automakers to meet demand.
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In fact, the auto market in the entire Mercosur region is doing very well, with Argentina also seeing new records.
Fiat was first, announcing that its Argentine Córdoba plant (idle since 2001) would resume automobile production next January with the Siena sedan, well ahead of the Indian Tata-based medium-size pick-up also planned. That decision followed the hiring of over 3,000 new workers for a third shift at the main Betim plant in the Brazilian state of Minas Gerais.
Next, Volkswagen announced a second Gol shift at its troublesome (strike-prone) plant in São Bernardo do Campo. Half the newly-hired 700 workers are seasoned former employees needing little training who should help ramp-up assembly line speed. The other two plants (inland São Paulo and Paraná states) are already working three shifts.
Just after finishing expansion of its Sumaré (São Paulo state) plant expansion, Honda, on the eve of GM’s unveiling of a $300million investment in Brazil and $200million for Argentina, announced a $100m spend to produce cars in Argentina as well. There had been some pressure from the government there over the Japanese automaker’s focus here in Brazil.
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By GlobalDataThe Campana facility (in Buenos Aires province) will be good for 30,000 units yearly, or one fifth of Honda capacity in Mercosur. The automaker did not reveal the planned model, but just-auto has learned it will probably be the Aria, a sedan derived from the Fit/Jazz hatchback already built in neighbouring Brazil.
GM will focus investments on developing different versions of new cars for each country. It is still quiet on the details but the Corsa successor for emerging markets is most likely.
An extra $100m will be sprung to expand the São Caetano tech centre but GM has no workforce-boosting plans to increase production. Its three Brazilian units and Argentina’s Rosário plant will stay on two shifts.
GM Mercosur president Ray Young will increase production during this second half-year solely by getting rid of bottlenecks and more intense use of continuous improvement programmes, and reckons this will let him meet demand in both countries. Chevrolet – the GM brand here though most vehicles are locally-developed relatives of GM Europe’s Opel designs – actually lost share in the first half due to insufficient capacity.
GM chairman and CEO Richard Wagoner (who speaks the local Portugese language) visited recently to talk investment, and said having to meet demand was a “high-class problem” and much better than finding customers for excess output.
Fernando Calmon
