Brazil a magnet for auto manufacturers: Land Rover and KIA with plant plans
Jaguar Land Rover will likely decide before the end of this year whether to build a factory in Brazil, local President Flavio Padovan said on Tuesday. South Korea’s KIA Company is also considering the manufacturing plant option following the increase in import taxes.
JLR is studying new auto industry rules that go into effect starting next year and is weighing its options, said Padovan at the Sao Paulo Auto Show. “There are still some details missing before we can finalize our plan, but we have great interest in being here in Brazil.”
Padovan said that it makes more sense to begin producing Land Rover vehicles at a possible factory rather than Jaguar models, due to the limited scale of Jaguar sales. JLR sales for Latin America this year will likely reach 12.000 vehicles, up from 10.500 in 2011, he said.
Brazil sales have suffered from a 30 percentage-point hike in import taxes, but sales should improve somewhat next year. That is because next year the government will exempt up to 4.800 vehicles from the higher tax.
”With the quota (receiving a tax discount), sales in 2013 will be better than 2012, but still not as good as 2011“ Mr. Padovan said.
In related news the President of KIA Brazilian operations said he was hopeful that the South Korean company will decide to build a plant in the Latin American country.
Jose Luiz Gandini, who heads the Brazilian operations, expects to sell about 45,000 KIA cars this year, a big plunge from the almost 76,000 vehicles he sold last year. Higher import taxes put in place at the end of 2011 and lasting through 2017 has cut sales drastically and will likely keep sales at the 45,000-to-50,000 level next year, anticipated Gandini at the Sao Paulo Auto Show.
”We can survive, but sales will fall“ Mr. Gandini said. ”KIA isn't going to throw this all away. I have faith that it will happen,” he said, referring to talks about a factory in Brazil.
KIA partner Hyundai is building a Brazil plant, but Gandini brushed off the possibility of shared production at the factory because Hyundai wants to take full advantage of capacity there.
German carmaker BMW top executives met on Monday with President Dilma Rousseff and announced plans to build a factory in southern Brazil, a more than 200 million Euros investment expected to create 1,000 jobs. The luxury car giant hopes to start building the plant in April next year and producing cars in late 2014.
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Another proof that KaMoron’s policies are promoting growth in any part of the world but UK.
Poor Britons...
You are a fool, the side mirrors are still being produced in Manchester!!
fwiw its also not British - its owned by Tata (India).
YMMV but I would have thought that the Brazilians are happy for the foreign investment and jobs this will create.
Other countries in South American clearly didnt even get a look-in.
I luuuuv that car!
We made a lot of money pulling the cars back from dissatisfied customers because of poor build quality. I stopped buying the Discovery when my last one suffered catastrophic engine failure on a motorway due to the timing belt failing, again incorrect assembly and it did it for me.
TATA have made a huge success of the Jaguar arm, but seem to be struggling with the LR ‘we know better than the customers’ approach.
Moving assembly to Brasil will give LR an opportunity to produce the cars in accordance with the design engineers wishes, for a change.
As one LR executive said to me: we must get our quality better than this: he left the company shortly afterwards. It seems his view was not popular with Senior Management.
It has nothing to do with UK government policy.
Brazil has steadily increased import taxes on imported cars, which make LandRovers produced in the UK very expensive. Most of the major auto manufacturers now have - or are setting up - manufacturing operations in Brazil... so Land Rover will face still price competition from lower-taxed Brazilian-produced products from other German, Japanese, Korean (and perhaps Chinese) firms. I'm not sure LR has an alternative but to set up in Brazil - where it currently outsells BMW - in order to secure a continued and growing demand for LandRovers. Bear in mind that some parts will likely continue to be designed and manufactured in the UK.
JLR's future in Brasil is with LR, rather than going head to head with BMWb in the executive class. ... time enough for that. Beating off Mitsubishi is the future for its development in the continent.
UK development and the Indian financing.
Feel free to disagree; I'm no expert in this field.
But I so wish that Brasil was evolving its own car/4x4 domestic industry to beat off the foreigners and win the South American market for itself.
@2
No you are a fool Guzz, Land Rover still build the vast bulk of their vehicles in the UK. While Jaguar build all their models in the UK. So what do you really know? Nothing.
The only comment I would make regards the development of 4x4s by Brasil.
LR have taken many years to get to the latest luxury 4x4s from the original offering in 1970. This vehicle was a revelation of how comfortable travelling over ploughed fields could be, if a little basic.
The Range Rover of today is a very sophisticated vehicle indeed and only by copying it could any other country even begin to match it. The upcoming Defenders are likely to be even more complex than the current model and that has had complaints that it can no longer be serviced by the farmers workshop (it has a CanBus) The reality is that new manufacturers could not.
What they could do of course is to limit their initial attempt to a ‘Brasil version’ which could restrict the encroachment of electronics to fuel management only (it will need to be emissions compliant). The rest of the vehicle would still be serviceable by workshops with limited means because the fuel system would be Bosch and therefore supported by their network.
LR may even wish to get on board with such an enterprise because it would not really compete with them for the first five years or so, and who knows what would be needed in Brasil by then?
jag land rover are expanding hugely in uk, 1500 extra staff in design , and manufacturing assembles line 24 hrs 7 days a week pumping out the cars that all the world want to drive. a motorway junction near the design centre is being doubled in size to help all the thousands of extra workers.
Jajaja anothermUK success... Try better trolls and do some research before spouting lies
First ever positive, interesting instructive post from Mr. ChrisR!
I want Brazilandy!
Eezi Awn on her roofrack...
25 km x l. Diesel engine...
Stainless Steel chassis...
Gorilla glass windows...
LED light system...
No electronics...
No A/C...
Under 100,000 pesos...
5 years guarantee...
Can't wait for it...
Where do I sign?
Don't fool yourselves with the free market Brits, you will only end up loosing your jobs...
just hope the good news story continues, my village is full of range rovers and jags of the well paid Jag Landrover workers. ood bless Tata for saving it and investing in the great British brand.
For all the quality problems that still plague the top end LT, there are many more that plague the top end Mercedes cars.
It is a fact that LR needs other countries to produce cars it has / will easily have orders for and if not Uruguay, and with the 'union' problems and no spare production trained operators (plenty of non-productive government workers), why not Brasil?
I doubt if there will be a contract clause that autoparts for the Brasilian Land Rovers will be manufactured in Argentina. For so many reasons this is a non-starter.
Hi, Chris,
my 1970s LR was distinctly basic ....
SWB Army, geared down for heavy towing, still with the bren brackets and fully camo-ed.
Towed many a horse to shows all over the UK.
“Memorrriiiieeesss”
German cars are above all, no matter how much you like LR.
I've been in many places, and a BMW or Mercedes is always seen as the best when it comes to innovation and technology. German machinery in general is world nr 1...
You did not answer my question. Wasn't Land Rover owned by Ford I am almost certain that it was. I wonder why Ford would sell the Company, given that it had access to it's largest market.
20 GeoffWard2 (#)
Not quite. Brazilian factories can get their parts anywhere in Mercosur. If there are reasons it can't, name them.
The Brazilian government clearly states that it wants no restrictions in subcontracting within Mercosur. This was one of the sticking points with BMW and why a deal almost fell through. It is certainly chepaer to subcontract
within Mercosur than importing them from somewhere else. I remember when I was in Argentina around 2000, the was an effort to manufacture the brand in the country.
I don't see any possible influence by the British Government. The company is not even majority owner by British capital. Besides, there are no commercial trade restrictions between the Britain and Argentina.
I sold my Volkwagen hardly few months ago .
I thínk a Japan are bétter.
German cars have a certain prestige but the Japs give more quality for your money. In the terrain we have here, nothing competes with Japanese (or UK if you have the money) off road.
...if you are going to go exploring in northern Chile or down in deepest darkest Patagonia you are best in a Toyota Hilux or 4-Runner....luxury is not breaking down 500kms from nowhere.
Drive a Toyota myself...
Tata have invested billions and reaped the rewards a now booming car company.
Dont try to twist the story, simple facts are Jag Landrover is booming, factorys in UK are working 24/7 thousands of extra staff recruited to the design centre alone, a true UK success story with the backing of an Indian company that was willing to take a risk.
As a great lady said, ''just rejoice at that''
Try to google a negative story about Jag landrovers sales or UK jobs , I will await your troll results. jajajaja
Ford will close plants in UK
www.telegraph.co.uk/finance/newsbysector/industry/9633043/Ford-to-cut-1400-jobs-in-Britain.html
www.nytimes.com/reuters/2012/10/25/business/25reuters-ford-jobs.html?BU-D-E-AD-OB-TXT-BUS-ROS-0512-NA&_r=0
I don't ‘think’ or ‘guess’ at what cars are the most reliable. In the UK we have many warranty companies who keep records on all the repairs carried out to the cars they insure
This year the list is (No1 = BEST)
The most reliable used car brands according to What Car? and Warranty Direct
1 Honda
2 Toyota
3 Lexus
4 Suzuki
5 Subaru
6= Hyundai
6= Mazda
6= Mitsubishi
9 Chevrolet
10 Nissan
11 Kia
12= Ford
12= Skoda
14 Citroën
15= Peugeot
15= Daewoo
15= Smart
18 Mini
19 Fiat
20= Seat
20= Volkswagen
20= Volvo
20= Porsche
24 Vauxhall
25 BMW
26 Audi
27= Rover
27= Jaguar
29 Mercedes-Benz
30 MG
31= Saab
31= Chrysler
33= Renault
33= Jeep
35 Alfa Romeo
36 Land Rover
I told you!
Meanwhile............, in “Basket Case Argentina”, General Motors announces an investment of 450 million U$D.....:
media.gm.com/media/us/en/gm/news.detail.html/content/Pages/news/us/en/2012/Oct/1024_GM_AR_Investment.html
With all respect, do you use a list when you shag your good old woman as well? What's up with all your lists, seems they are you new bibles....
Lost the argument and changed the topic. Oh dear!
Did you see where LR was and Mercedes? Did you not read my post properly, how I had given up buying Discovery’s due to serious problems?
Have you ever driven a number of Mercedes models? If you go to Germany they use these things as taxis (albet the cheap, home market versions). Believe me, they are overpriced and unreliable to boot.
You were having an argument? I thought we were talking about cars....
I don't know what you prefer and see as a good car, but I know what I like in a car. Big diesel engines is part of my labour and Otto engines are interesting as well. When we talk engines, I can assure you I believe (argue that!) the Germans are the best. When it comes to cars, most cars of today fulfill the needs of us mere enthusiasts, and there is a wide range of models to choose from. It's all about personal liking, I'd say...
In English, the term ‘argument’ means a discussion. If you disagree vehemently with someone, you have a row.
I never row with anyone because by then both parties have lost the plot. Prat-Junta is the classic example.
I have an extensive knowledge of the car industry having been involved with it from design to having my own car sales business and I can summarise it with this joke:
If it’s got tits or wheels, it’s going to be a problem!
Teasing me with the superlative periods eh!
BTW why use the Otto name for the ubiquitous 4-stroke petrol engine? Being a ship man I would have thought you liked 2-stroke diesels. Bet you can’t name a lorry (18 – 38 tonnes) that had this type of engine fitted not too long ago.
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