Among the three German premium brands on sale here in Brazil, Mercedes has been enjoying the greatest growth.
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The volume of fully imported vehicles doubled between 2005 and 2008 while, in the first five months of 2009, sales rose 35% year on year. Mercedes now looks like closing this year with a sales tally in the vicinity of 5,000 units.
Nonetheless, its Juiz de Fora (state of Minas Gerais) plant is cutting production of the most affordable Mercedes – the C class coupe. The Brazilian plant is now sole company factory building the CLC for global sale – it previously built the first generation A-class – from 1999 through 2005 – and has also assembled C-class models from CKD kits for export to North America.
Last year almost all the 28,000 CLCs built in Brazil – with less than 40% local content – were exported (local sales are symbolic; 600 units forecast for this year). That, incidentally, was the largest number of cars ever produced in a single year at Juiz de Fora.
But, with sales in international markets weakened by the credit crunch, the production forecast for this year is 20,000 units at most.
The US$700m plant employs 1,700 both directly and indirectly but its full 70,000-unit annual capacity (on three shifts) has never been reached.
Although a truly modern facility, it has never been profitable due to its excess capacity.
Fernando Calmon
Mercedes Brazil plant gets reprieve
