Brazil in 2012: Fiat Celebrates Early For Fear That VW Will up! Them

Marcelo de Vasconcellos
by Marcelo de Vasconcellos

Video o.k. for network TV in Brazil, but NSFW in certain jurisdictions. Do not click if naked derrieres offend you.

The numbers for the first eleven months of the year have been consolidated. The first fortnight of December has been basically more of the same. It’s now quasi-official: Fiat is the biggest pig in the sty for the eleventh time in a row. They already have an ad out celebrating the fact. Last year the Italians waited until January to commemorate. This year they had no such compunctions.

Curious is the theme they chose to celebrate their victory. Don’t think a green-eyed spermatozoon, masturbation and bodily functions would be GM’s choice to celebrate their market dominance in stodgy America. Oh, those racy Italians!

According to a conversation I had with a senior Fiat suit last week, maybe this has to do with the fact that they are feeling the heat from VW and think they need to rub their leadership of the market in (due to VW being leader for 50 years and the Gol having been the most sold car for over 25 years, many Brazilians still believe VW is the leader in our market).

The Fiat grandee expects that next year VW will launch in the up! in Brazil. This car will be priced lower than the Gol and could give the Germans the lead in Brazil again after a decade’s hiatus. Fiat will have nothing new to fight the up!. Moreover, VW has recently hired the Fiat veteran who was basically responsible for car pricing in Brazil. This guy has his finger all over the market’s pulse and raised and lowered Fiat’s prices until he found the sweet spots. As other makers nowadays set their prices after Fiat’s lead (VWs start 5 to 10 percent over Fiat and Renault-Nissan low-balls Fiat 5 to 10 percent), the Italians worry (the exec confided to me) that VW now has the brains to regain for themselves the ability to establish pricing in Brazil.

Relative to the market, Fiat, Nissan and Kia made the most waves this year, according to Brazilian car specialist site webmotors. Fiat and Nissan in a big way and Kia in a negative way.

Despite increased competition and capacity constraints Fiat gained a little over 1 percent on the market by selling 11 percent more cars year-on-year. Nissan was the company to gain the most in sales (72 percent) while Kia lost almost 47 percent. Kia has not fallen out of favor with consumers but they suffered the most at the hands of government policy. Parent Hyundai also suffered. So much so that, relative to last year, they were overcome by their Japanese nemeses Honda, Toyota and Nissan.

Due to Nissan’s rise, Peugeot was shown the door of the top 10.

To put all of this in perspective, Brazil is the world’s fourth largest car market. Behind China, the US and Japan, but bigger than Germany, the UK or India.

Top 10 Brands, Brazil

Position (in 2012)Brand

Sales Jan-Nov 2011


Sales Jan-Nov 2012


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11 of 19 comments
  • SCE to AUX SCE to AUX on Dec 24, 2012

    Hey Marcelo - Can you elaborate on the government policies that affected Hyundai and Kia so much? And that ad is a strange one. Merry Christmas!

    • Marcelo de Vasconcellos Marcelo de Vasconcellos on Dec 24, 2012

      Hey! Merry Christmas! Basically they raised one of the taxes that affect cars by 30% for those makers who sell cars in Brazil but don't produce locally (importers, like Hyundai and Kia). For those who have factories in Brazil \(like the the traditional big Brazilian 4, the French, the Japanese) the tax was actually lowered. Some like Nissan, who are building a factory in Brazil have been given special treatment, too. Anyways, looking back on my articles on TTAC you'll find more elaborated answers. It seems to be working the way the government intended. Aimed at the Koreans and Chinese, they have seen their sales plummet. Also, it has prodded those with plans to build factories to hurry up plans (Nissan, BMW, JAC - Chinese). Kia is still dithering but Hyundai has just finished building their factory in Brazil but so far it produces only te HB20. THeir other cars have been slapped by the increase in taxes. Happy New Year!

  • Automaniak Automaniak on Dec 24, 2012

    Marcelo, you say: 'Fiat will have nothing new to fight the up!' 'This car will be priced lower than the Gol and could give the Germans the lead in Brazil' I think Fiat will just cut Uno price ;) By the way, do you know if Fiat intend to refresh Palio Weekend and Linea ? New Palio HB + Siena make great job for Fiat in Brazil. New Linea (face lift) is already available in Turkey where it's produced for (East) Europe.

    • See 7 previous
    • Marcelo de Vasconcellos Marcelo de Vasconcellos on Dec 27, 2012

      @automaniak Well th009, if you add up all the South American markets, indeed all of Central America (excluding Mexico) the market is not as big as Brazil's. So if your a maker does it make sense to be in Brazil. Sure even at the high (relatively) cost. In a market the size of ours the makers have to play by our rules. It's no bad thing. Free trade with Mexico was killing technological advances in BRazil. GM Brazil, VW Brazil used to be big tech developers. The intervention gave the makers here a breather. Guaranteed some jobs, helped keep the crisis away. It can't last forever or protect so much that the locals don't feel the external pressure. If that happens it'll be a repeat of the jobless and growthless 80s and 90s. But protectinism and gov investment provied the Brazilian Miracle of the 70s. Brazil will not give it up. Rightly or wrongly people believe in this in Brazil. Hopefully this time around, the tinkerers in Brasilia will have learned from past experiences and due it better. Fiat ain't complaining. Around 800 000 cars in one country. One legal department, one administration, one financial department, one dealership network. Imagine all the costs of setting up the same for each and every small South American market? Like a Fiat guy told me back in the 90s when they stopped producing in Argentina. I said you guys are crazy. You've been in Argentina for 80 years, you've been market leaders. He countered that at that moment (95 I believe) Fiat had sold all year in Argentian the same they sold for one month just in my city in Brazil (BH)! I understood of course. The investments, jobs and whatnot will follow the money. Brazil has to make its monet attractive. It can't compete with US and Canada.

  • SPPPP The little boosters work way better than you would expect. I am a little nervous about carrying one more lithium battery around in the car (because of fire risk). But I have used the booster more than once on trips, and it has done the job. Also, it seems to hold charge for a very long time - months at least - when you don't use it. (I guess I could start packing it for trips, but leaving it out of the car on normal days, to minimize the fire risk.)
  • Bader Hi I want the driver side lights including the bazl and signal
  • Theflyersfan One positive: doesn't appear to have a sunroof. So you won't need to keep paper towels in the car.But there's a serious question to ask this seller - he has less than 40,000 miles on some major engine work, and the transmission and clutch work and mods are less than 2 months old...why are you selling? That's some serious money in upgrades and repairs, knowing that the odds of getting it back at the time of sale is going to be close to nil. This applies to most cars and it needs to be broadcasted - these kinds of upgrades and mods are really just for the current owner. At the time of sale, a lot of buyers will hit pause or just won't pay for the work you've done. Something just doesn't sit well with me and this car. It could be a snowbelt beast and help save the manuals and all that, but a six year old VW with over 100,000 miles normally equals gremlins and electrical issues too numerous to list. Plus rust in New England. I like it, but I'd have to look for a crack pipe somewhere if the seller thinks he's selling at that price.
  • 2ACL I can't help feeling that baby is a gross misnomer for a vehicle which the owner's use necessitated a (manual!) transmission rebuild at 80,000 miles. An expensive lesson in diminishing returns I wouldn't recommend to anyone I know.
  • El scotto Rumbling through my pantry and looking for the box of sheets of aluminum foil. More alt right comments than actual comments on international trade policy. Also a great deal of ignorance about the global oil industry. I'm a geophysicist and I pay attention such things. Best of all we got to watch Tassos go FULL BOT on us.