Chinese makers come to Brazil
O Estado de S. Paulo
The Chinese makers prepare their landing in the Brazilian market with a capitalist appetite that does not resemble the companies that arouse after the revolution commanded by Mao Zedong at all. Besides Chery, which has just launched the SUV Tiggo in the Country, Build Your Dreams (BYD) and the Jianghuai Automotive Co. (JAC) have concrete plans to enter Brazil in the next two years. A Brazilian lawyer's office is advising two other Chinese makers of trucks, but it did not reveal their names.
"JAC is very confident it will make the Brazilian market into its base for Latin America", said the regional manager of light truck businesses, Sammi Shang. BYD said "the competition with the traditional makers is strong in Brazil". "But we are sure we will reach a considerable share of the market in the near future". The Chinese strategy is to begin with imports, in order to test the market, and later install plants in the Country, using parts from China. For the companies, the local presence is important to avoid the 35% of the Brazilian car import tax, to gain the confidence of consumers and dealerships and to comply with the Brazilian rules.
According to Shang, JAC has already started the preparations to build the plant in Brazil, whether by means of a direct investment or through a joint venture with a local company". Through its marketing department, BYD said the "final strategy has not yet been confirmed, but the first step should be the importation, followed by the local production, at a second stage".
With a plant in Uruguay, Chery is the pioneer of the Brazilian market and has 11 dealerships in the Country to sell the Tiggo. The goal is to increase the number to 55 until the end of the year. The company plans on building a plant in Brazil, which may consume investments from US$ 500 million to US$ 700 million.