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Stihl, Which Manufactures Products for Various Sectors, Expects Its Revenue to Increase with the Rise in Production in Brazil
The German tool manufacturer Stihl is experiencing exponential growth in Brazil, influenced by the agribusiness sector and other segments such as gardening, which gained significant attention during the pandemic as families focused more on home care. For this year, the tool manufacturer, which has a production unit in São Leopoldo (RS), is forecasting revenue of R$ 3.5 billion with its production, a 20% increase compared to 2021, according to the Broadcast website.
“At the beginning of the pandemic, we were in a panic because we didn’t know what was coming, but the demand for products increased significantly since then. With many companies adopting the home office model, Brazilians focused more on their homes, many moved away from large urban centers, and are closer to nature,” states the company’s president, Cláudio Guenther.
The company operates in the forestry, agribusiness, construction, and professional and domestic gardening segments, manufacturing electric and combustion equipment, such as chainsaws and brush cutters, for example. In the first half of 2022, Stihl reported revenue of R$ 1.8 billion, an 18% increase over the same period last year. Since 2019, the tool manufacturer has invested approximately R$ 1.1 billion in Brazil.
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President Guenther also comments that part of the company’s growth is due to the increase in production in Brazil. Currently, the company has approximately 4,600 sales points spread across Brazil. During the pandemic, the company opened a distribution center in Jundiaí (SP) and will soon inaugurate another one in Benevides (PA).
Stihl exports most of its production from southern Brazil, which is highly verticalized. Guenther adds that two product lines set to be launched next year will have about 70% local content, which, according to him, has helped the company, especially after the recent issues in the global supply chain and the war in Ukraine.
Stihl Exports Favor the Company’s Foreign Exchange Situation
The high demand for the company’s exports also favors its foreign exchange situation, the president affirms. In Brazil, Stihl produces 90% of the cylinders used in the brand’s factories worldwide.
“The cylinder is essential for the operation of the machine and also for new technologies in this area. They also contribute to reducing emissions. When we export cylinders, we are exporting technology and know-how, with more professionals involved in the operation,” comments the president. The cylinders manufactured by Stihl account for about 25% of the company’s portfolio in Brazil.
With the increase in its production, Stihl has made 1,500 hires since the beginning of the pandemic, totaling 3,700 employees in Brazil alone.
“We have a policy of increasing our presence in the Brazilian market, with training at the point of sale, technical sales management, and mechanics courses,” reports the executive.
The executive also says that Stihl is looking to bring new production lines to Brazil. “We need approval, still this year, to start the production of high-pressure washers in the country,” he explains.
Diversification is an essential element for the company in a scenario where battery-powered electric products may gain more market share globally. Currently, Stihl only produces corded electric and combustion products in Brazil. With this, Guenther states that the production of cylinders may decrease in the future.
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