References

Sadia is one of the world’s leading producers of chilled and frozen foods. Established in Brazil in 194...
Cyrela Brazil Realty is the largest residential real estate developer in Brazil. Considered one of the m...
Today, Banco do Brasil is the largest financial institution in the Country with 24.4 million clients and ...
CPFL Energia is a holding company in Brazilian electricity sector, operating through its subsidiaries in ...
Copersucar S.A. is the largest Brazilian sugar, ethanol and bioenergy company and a significant player in...

Automobile Industry

The Brazilian automotive industry began in 1956, in the city of Sao Paulo. Since then, the automobile industry has grown extensively. Several international automobile companies began investing in Brazil. Companies like Chevrolet, Ford, Volkswagen, and Fiat - all these companies saw Brazil as a potential market with tremendous profitable prospects and set up their business in the country. These companies dominated the Brazilian automobile market until the mid-1990s, when the Brazilian government opened the market for imports.

 

Brazil has a significantly large market base of consumers. Today, the automotive industry has spread its wing far across to assembling and making of Formula 1 racing cars. They have made the automotive industry a major contributing sector to the Brazilian economy. With globalization, the automotive industry has undergone an extensive transformation.

 

The Brazilian government is leaving no stone unturned in giving a major boost to its automobile industry. To attract more foreign investment in the sector, the government has been taking initiative and has made several reforms at macroeconomic levels. With a view to pull investment into the country, the government has completely restructured its investment policies. The government has ensured revision of all the policy barriers obstructing the growth of the industry, and has made special efforts to encourage healthy competition among many multinational companies entering the automobile market.

 

The Brazilian government has formulated favorable trade and investment policies to encourage private investments, and it has also made provisions to give the investors exemption from custom duties and other taxes on purchase of certain capital goods and infrastructure. The government, while laying great emphasis on attracting investment in the automobile sector of Brazil, has very tactfully struck a balance to give a boost to the domestic industries.

 

The Brazilian government is making efforts to uplift the face of the auto industry in the country. The government is pumping in a great investment of about $4 billion in the Brazilian auto industry.

 

Today, great opportunity exists for automobile part makers to invest in the Brazilian automobile market. This is mainly because Brazil is a developing country. Brazil is overly ambitious to make its automobile industry at par with the developed countries of the world.

 

Business analysts have predicted that investing in the Brazilian automobile industry would yield great profits for investors in the near future, as Brazil is touted as being a great market for automobiles.  Auto industry in Brazil is anticipated to do well in the near future as several events of great importance are about to take place. One of the prominent events is the 2014 edition of the FIFA football World Cup. This would require top class transportation facilities to be made available throughout the country, and there is a great opportunity for investors to invest in the sector. Also, business analysts have predicted that agricultural and other agro-based industries, and also the mining industry, will grow in the coming years. This would require the efficient transport of the agricultural products, and this would boost sales of trucks by about 6-7%.

 

Thus, the automobile industry promises a great return on investments for investors.