Ford 'burned' R$ 61 billion in its operation in Brazil and the multinationals Volkswagen, GM and Toyota also accumulate billionaire losses in the country
Ford Motor accumulated a loss of R$ 61 billion in Brazilian operation. The values consider the last years and the amount that will have to be paid to close the activities in three factories installed in Brazil. The amount was revealed by the Reuters agency. To get an idea, the American burned the equivalent of 610 thousand EcoSport Titanium 1.5 AT 2021.
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According to Reuters, “Ford had burned US$7,5 billion (R$39,5 billion), most of it in accumulated losses, but also in some cash injections, according to documents filed in the state of São Paulo, where the automaker is registered in Brazil.”
In addition to this amount, the agency took into account another US$ 4,1 billion (R$ 21,6 billion) that will be spent on closing three factories, with compensation for more than 5.000 workers and 300 dealerships, totaling US$ 11,6 billion, equivalent to 61 billion reais. Frequent losses led Ford to decide to end car manufacturing in Brazil.
Volkswagen, GM and Toyota also accumulate billionaire losses in Brazil
Still according to Reuters, at least three other automakers accumulate billionaire losses in Brazil: “Volkswagen Brasil accumulates losses of US$ 3,7 billion (R$ 19,5 billion) since 2011, according to Jucesp records. GM Brasil has received US$ 2,2 billion (R$ 11,6 billion) in cash injections since 2016 and Toyota Brasil, last year, received forgiveness for US$ 1 billion (R$ 5,3 billion) in debts with the matrix, the documents showed”.
The Reuters report says that the parent company helped Ford Brasil with nine capital injections between March 2018 and January 2021 alone, with an amount of US$ 1,3 billion (R$ 6,8 billion). According to journalist Marcelo Rochabrun, who wrote the Reuters report, the data are in the archives of the Board of Trade of the State of São Paulo (Jucesp).
Over the past eight years, each car sold by Ford in Brazil has meant a loss of around R$2 (R$10,5). Reuters points out two "culprits" for Ford's billionaire loss: the business environment and the company itself. Between 2011 and 2019, Ford increased car sales to fleet owners by five times, with discounts of 30% or more. “A 2019 PwC study found that selling a Mexican car in Brazil was 12% cheaper for an automaker than selling a locally made vehicle, including production, tax and logistics costs,” the report explained.
After interrupting vehicle production and leaving the country, Ford Motor unloads 450 cars at the port of ES and will bring 30 vehicles to Brazil produced in factories abroad
After ceasing to manufacture vehicles and closing its factories in Brazil, automaker Ford Motor starts importing vehicles through the Port of Vitória. Last week, 450 cars disembarked, which arrived in the state by the ship Torrens. It is estimated that approximately 30 cars will arrive in Brazil, via Espírito Santo, per year.
Last Tuesday, May 18, the first vehicles of the American automaker arrived at the port of Vitória. Before, Ford brought its cars through Baixada Santista and Bahia.
Now, the Port Terminal of Vila Velha (ES) will be Ford's only gateway to Brazil. According to Log-In Logística, the company responsible for the operation, the complex will receive, annually, around 28 thousand and 30 thousand cars from the American company.
As well as the iconic Volkswagen Kombi, new legislation makes Fiat's Uno, Doblo and Grand Siena disappear this year
According to journalist Fernando Calmon, columnist for Portal AutoPapo, the multinational Fiat will have to end production of Uno, Doblo and Grand Siena. This is because, as of January 2022, a new phase of Proconve, the L-7, will take effect, and the three models of the Italian automaker will disappear due to the new requirements for environmental control emissions, just as happened in 2014 with the iconic Volkswagen Kombi, due to the requirements for airbags and ABS brakes.
According to Calmon, the Fiat factory doesn't think it's worth investing in new tanks and a power supply system for these cars to comply with the new evaporation limits from gasoline and ethanol tanks.
