Kwangjin chooses Sumaré for the construction of its first plant in South America
With the support from Investe SP, South Korean company invests R$ 35 million, creating 170 jobs and nationalizing the production of auto parts
Investe São Paulo
The South Korean supplier of auto parts Kwangjin will invest R$ 35 million in a new plant located in Sumaré (SP), which will be the company’s first plant in South America. The company will produce mechanisms and modules for car windows and, on August 3, it will enter into a memorandum of cooperation with the municipality of Sumaré, at the seat of the municipal government.
The project relies on the support from Investe São Paulo, the investment promotion agency associated with the Department of Economic Development, Science, Technology and Innovation.
“Kwangjin sees a great potential in the Brazilian automotive market and we are very optimistic about the future of our company in the country. We would like to thank the municipality of Sumaré, Investe São Paulo and our employees for welcoming us so warmly and for providing all the support required for our first plant in South America,” said Daniel Kim, CEO of Kwangjin Brazil.
It is expected that, by 2020, the company makes a new investment in Brazil, which should total R$ 70 million. The idea is to build a unit to increase production and bring new buyers.
In Brazil, GM, Hyundai and Volkswagen are the main clients of Kwangjin. General Motors currently buys modules and mechanisms for car windows and lock systems from the Mexican unit of Kwangjin. But the automaker requested the company to come to Brazil to help increase the rate of domestic content of its vehicles.
“The company’s priority was to be next to one of the main automotive hubs of the state. In Sumaré, Kwangjin will have access to excellent roads and qualified workforce for the plant,” said the president of Investe SP, Juan Quirós.
The unit is being structured in a rented shed, generating 170 direct jobs and 30 indirect jobs. The idea is to serve 600,000 vehicles per year by 2017, but the total capacity of the plant is expected to reach 1.3 million per year. Sales are expected to reach US$ 60 million per year as of 2017.
“Sumaré welcomes Kwangjin. We have had a good relationship with the companies that are already settled or are coming to the city. Currently, there is municipal policy to seek and attract new investments through this good relationship. Despite all the difficulties that have been faced by the country, Sumaré is attracting many private investments, our companies are expanding the production and opening new businesses,” said the mayor Cristina Carrara.
She also highlighted the municipality’s performance in attracting investments over the past few years. “The city has been increasingly gaining space in the national economic scenario. Many companies are expanding, and others are announcing that they are coming to the city. We are facing a wide range of opportunities and we are occupying these spaces. And when the companies arrive here or expand their activities, they will need more workforce, new suppliers, creating a virtuous cycle of development,” said Cristina Carrara.
To date, the company already has agreements with GM and Volkswagen, but there is a possibility that it also supplies to Hyundai, partners of Kwangjin in other places, such as Europe and China.
Kwangjin’s project was brought to Investe SP by the Brazilian Trade and Investment Promotion Agency (Apex-Brazil) in 2014, as a result of a mission to South Korea that year, seeking to attract supply chains for major global automakers in Brazil. Since May 2014, Investe SP has been providing assistance to the company, especially in the identification of areas in line with its activity and in the dialogue with municipal governments.
About Kwangjin
Kwangjin (Chairman and CEO: Young Jik Kwon) was founded in 1973 and is currently present in approximately 16 countries. In 2014, the sales totaled U$ 660 million. The company supplies to KIA, General Motors, Volkswagen and Hyundai, supplying parts such as glass regulators, modules for doors, pedals, hood hinge and trunk lid hinge around the world.
Kwangjin was honored 14 times, including 13 consecutive years in the period from 2002 to 2014, as supplier of the year by GM.