Brazil’s current weak auto sales, likely to spill over from 2014 into 2015, seems to be far from the best background for the huge investment just made by Nissan in Resende, 100 miles northwest of Rio de Janeiro City.
It’s a big spend, that BRL2.6bn (US$1.5bn), on a plant able to produce 200,000 cars and the same number of engines a year. But the Renault-Nissan alliance global chief, Brazilian Carlos Ghosn, said the group deems this move as strategic.
Go deeper with GlobalData
“We did not invest looking six months ahead, but 10 years from now. We need this plant to keep up with this market’s growth. Brazil today is the fourth market in the world in domestic vehicle sales terms but it falls short of 400 inhabitants per 1,000 vehicles motorisation index. Potential is much bigger than that, so why shouldn’t we look for a better rate, perhaps like Portugal (200/1,000) today?,” he said at a press conference following the plant opening ceremony.
Ghosn also said that Nissan’s current market share in Brazil was only 2% and he is eyeing growth of 1% a year to 5% by 2016.
“New products will come off these lines to reach our goal. Right now in Resende we will have two cars, March and Versa, besides those coming from Mexico [under a free trade agreement – ed]. I would say we need at least four models made here,” he added.
Sources have told just-auto that the current V platform can take a compact SUV, shown in sketch illustrations at the 2012 São Paulo Auto Show. The Note could be another candidate, although it is produced in Mexico already, and integration of the two markets will continue.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataGhosn told just-auto a year ago that manufacture of the new sub-brand Datsun product would depend on domestic market consolidation. Yet his answer to the same question this year was along the line of “one thing at a time” with no direct, detailed response.
The high engine production capacity suggests the supply of one-litre engines made by Renault in São José do Pinhais, state of Paraná, may be switched to engines made by Nissan itself. This displacement class is surging back into popularity here (currently 40%). Resende’s ultra modern facilities offer opportunity to develop new engines to replace the current generation of I3 units.
