Ramping up Business in Brazil, Chinese Chery Deeply Exploiting South American Auto Market

Ramping up Business in Brazil, Chinese Chery Deeply Exploiting South American Auto Market

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On 20 August, 2009, Chinese largest independent car manufacturer Chery officially started its business in Brazil, and planed to establish 55 dealerships in 14 states of Brazil before the end of the year. Earlier in July, Chery has made a debut in Southern industrial city Campinas, carrying its key model Tiggo SUV. More than 300 guests from Chinese Embassy and Chinese-funded enterprises in Brazil, and relevant Brazilian government organizations attended the launch ceremony.

Tiggo is the first model for Chery’s entry to Brazil. It is also one of the important medium-/high-end models of Chery in China, with body length of 4285mm, wheelbase 2510mm. The Tiggo is equipped with 2.0L ACTECO engine which generates max power of 102 kW, and delivers peak torque of 182N.m. By adopting chassis of middle sedan and being adjusted by Lotus Corp in UK, Tiggo can effectively relieve bumping from the road so as to meet different needs of different road conditions, through which it assures both sports performance and comfort as well. In terms of safety, Tiggo is equipped with standard front dual airbags, offering new ABS+EBD of Germany TEVIS, combined with four-wheel large-size brake disk and high-mounted brake light. Moreover, Tiggo especially applies NVH noise reduction technology which makes drivers sense quiet environment while enjoying uninhibited personality of SUV.

Those Tiggos imported to Brazil are assembled by Chery’s plant in Uruguay, and are presented to customers through 27 local auto dealers in 25 main cities in eastern and southeastern part of Brazil. It is expected that the sales volume will reach 2500 units by the end of the year.

Zhou Biren, the Vice President of Chery Automobile Co. Ltd., said in the Tiggo launch ceremony that, besides Tiggo, Chery will also bring QQ, A3 (key models in China) and A1 (produced in Uruguay) to Brazil market. At the same time, before the end of the year, Chery plans to double the number of its 4S stores in Brazil, which is supposed to exceed 50. Besides, since Brazil is one of Chery’s most important overseas markets, Chery will conduct feasibility analysis on establishing plants in Brazil, taking into account the elements of investment, cost and sales volume.

In addition to introducing mature products to Brazil, one of the largest producers of biofuel, Chery intends to launch localized flex-fuel models. Last year, the flex-fuel cars sold in Brazil occupied 86% of the total. Zhou said that, by offering best products and first-class service, Chery hopes to bring profound comfort, convenience and surprise to Brazilian lives.

Currently, Brazil is the ninth largest auto market around the world, and the most important market in South America with fiercest competition. So far, the top 15 auto makers of the world have established plants in Brazil. Even in 2008, cars sold in Brazil still reached 2,820,000 units, increased by 14.5% year on year, and the number is forecasted to exceed 3000,000 in 2009. In 2008, through cooperation with MACRI Group in Argentina, Chery established a plant in Uruguay with annual production capacity of 20,000, which also exports cars to Brazil, so as to achieve the centralized structure in South America, radiating Latin America. From Chery’s successful entry and its plan in Brazil, we can see that Chery has basically achieved its first-stage objectives and begins to start up its second stage development in South America. That is, together with Uruguay plant, to form the effect of dual radiation to Latin America, which leads to the stage of competing for mature markets with global established auto makers. The overseas strength of Chinese Chery has been gradually manifested through its low-keyed and steady business layout.