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China's automaker Chery bets on Brazil's economic recovery to gain market share

Xinhua | Updated: 2018-03-30 14:29
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RIO DE JANEIRO - Chinese automaker Chery is betting on Brazil's economic recovery to gain a larger share of Latin America's biggest auto market.

As part of the plan, the company this week unveiled Tiggo 2, the first vehicle jointly manufactured with Brazil's Caoa Group to cater to the Brazilian market.

In an interview with Xinhua during the presentation of the new SUV, Chery's General Manager Chen Anning said the company "is taking a long-term view of the Brazilian market, with long-term investments."

Latin America's biggest economy is bound to bounce back from recent sluggish growth and the Chinese-Brazilian joint venture Caoa Chery will be ready, he said.

"The economic crisis in Brazil will not last very long," said Chen.

"What's more, in the few months of partnership with Caoa, the Brazilian economy has begun to recover and already borne fruit, such as the birth of Tiggo 2," Chen said.

In addition, Chery's strategy of partnering with the local firm has built-in security, he said.

"By joining forces, whether the market is good or bad, we will see positive results," said Chen.

Chery wanted to partner with "a local force to help get the operation up and going faster and have a greater presence in each market," he said.

"The partnership between Caoa and Chery is complementary with each other's qualities. Chery can develop, produce and manufacture a quality product, and Caoa has ample knowledge and experience in commercial marketing and services in the Brazilian market," said Chen.

Caoa specializes in the manufacturing, sale and distribution of automobiles nationally.

Tiggo 2, manufactured at Chery's plant in Jacarei, Sao Paulo, is the first model rolled out by Caoa Chery since the two companies announced their joint venture in November.

Its production is "a great step" for the partnership, which is poised to expand as "Brazil is the continent's biggest market," said Chen.

Mauro Correia, president of Grupo Caoa, said the partnership with China's leading automobile assembler and exporter "will bring great benefits" to both firms.

The joint venture will also benefit Brazil, because it allows it "to have a Brazilian brand, a national company, that has an agreement with a company from the country with the world's biggest market for automobiles, such as China," said Correia.

The potential cultural differences are not an issue since Caoa has prior experience of working with foreign automakers, including Japanese, Korean and American firms, he said, adding "our relationship is guided by transparency and trust."

The partnership is working "very well, we succeeded in undertaking very important developments in very short periods of time, like adapting the product and changing the production line ... all at a very fast pace that allowed us to bring a new product to market in a very short time, from the signing of the agreement to the vehicle's market entry," said Correia.

China's technological strength provides the partnership with added confidence, he said.

"In five years, China has built 10,000 km of high-speed rail, all made in the country, with national technology. Its engineering is highly competitive, they make planes, they have aerospace equipment, electronic technology .... If you go to China, you see the quality of Chinese products," said Correia.

Caoa Chery aims to create "a very competitive portfolio with which to capture 5 percent of the Brazilian market," he added.

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