One key criticism levelled at the auto industry here in Brazil is about the number of outdated models still on sale here compared to Europe, from where over 80% of the cars and light commercials offered here originate.
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Automakers reckon that limited consumer buying power and low output following the 1997 economic crisis limited the capacity of the Brazilian domestic market to absorb Europe’s more sophisticated products, even in the compact segment.
There are some exceptions – VW’s Polo, Fiat’s Punto and Idea, Renault’s Dacia-designed Sandero, Citroen’s C3 and C4, and Renault’s Mégane II [a redesign is about to be launched in Europe] – but generally new models’ launches here are often long delayed after release in their source countries or ‘new’ models are launched here just as they are about to receive major changes in Europe.
Japanese models sold here, are in contrast, either current versions or generally far less outdated than versions sold elsewhere.
However, two recent developments are starting to change this scenario.
Firstly, there is new pressure from fully-assembled imports, likely to grab nearly 15% of the Brazilian market this year. Secondly, production volume rising fast in the Mercosur trade region.
By 2013, output should top 6m vehicles a year (5m in Brazil, 1m in Argentina). As the world’s fourth largest region by production, there will be new economies of scale.
Ford [which recently redesigned the first-generation Ka locally rather than waiting for the new one developed and built in a Ford Europe joint venture with Fiat] has already signalled a change of strategy.
“Launches outside the country will arrive on our assembly lines here in shorter time”, said Ford Brazil’s corporate affairs director Rogélio Golfarb though he didn’t elaborate on deadlines or specific models.
However, it is already common knowledge that the new Focus, recently launched in Europe, will be produced (and exported to Brazil) at Ford’s Argentine Pacheco plant from September, alongside the current version.
It also appears certain the redesigned Fiesta [production started in Germany today; Mexican output is due by 2010], will be built at Ford’s plant in Camaçari, Brazil, but no sooner than 2010. In this case the current Brazilian Fiesta will be ‘out of date’ for a while but only by a year or so.
Other brands are moving to follow the same path with PSA’s Peugeot 308 and C3 Picasso (not the C4 sold elsewhere), a new, locally-developed ‘one-box’ based on the new C3, and, possibly, VW’s just-announced Golf VI all in the Brazilian pipeline. Fiat will launch the Bravo here in 2009.
Delays will still be in the 20-month bracket but seem likely to be reduced in coming years to between six and 12 months.
Fernando Calmon
