Azaleia announces investment after Government taxes Chinese shoes
DCI
Seven days after the Government taxed the import of Chinese shoes in order to prevent dumping, the Vulcabras/Azaleia Group, largest shoemakers of Brazil, starts hiring again and promises to expand the productive capacity of the company by 10% in the last quarter of this year, compared to the previous quarter. To DCI, Milton Cardoso, CEO of the Group, affirmed the company has decided to resume the investments under the influence of the measure of the Government to tax in US$ 12.47 every pair of imported shoes from China which, as he says, should reduce the "unfair competition". For him, the measure opens doors of opportunities for the national products.
"The scenario starts changing because of the Government decision of prohibiting the illegal imports; this is an incentive to the Brazilian shoemakers", said Cardoso, without mentioning the investments to be made in the productive park due to the fact that the company has gone public. Headquartered in Jundiaí (SP), the company announced the hiring of 1.8 thousand employees in the several units of Brazil. Currently, the company has 37 thousand employees.
The entrepreneur affirmed the increase of the productive capacity by 10% in the last quarter of 2009 will be positive enough for the group recover the 10% loss registered in the production of the last quarter of 2008, when the low dynamism of the domestic sales, damaged by Chinese products, was worsened by the burst of the world economic crisis. Such result will also be enough to recover the 9% fall in the earnings in the third quarter of this year. Because of that, the entrepreneur estimates closing 2009 with flat earnings compared to the R$ 2 billion (US$ 1.1 billion) verified in the prior year.
Representative of the Brazilian Association of Shoe Manufacturers (Abicalçados), the entrepreneur did not want to estimate the reduction foreseen of the inflow of Chinese shoes to Brazil. He assured, however, that the measure represents a change in the scenario for the sales of the company in the domestic market that fell 10% in the first half, compared to the same period of the prior year. Now that the demand is starting to react positively, Cardoso estimates the sales have increased and the participation in the second half may exceed the historic mark of 60% of the annual income. The expectation is to zero the losses had in the first half.