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Multinational Enterprises Group Project

From a group 4-5 students and choose a real life case (a company) operating in a specific market and discuss in what ways it contributed to local development, and which challenges it is currently facing. Talk about the social and environmental challenges.

What we choose to do:
VW Factory- Curitiba, Brazil- Volkswagen do Brasil Industria de Veiculos Automotores Ltda.in Curitiba, Brasil.

Background: VW is Brazil s largest automotive manufacturer and now Brazil s largest automotive exporter

Inaugurated on January 18 1999, the S o Jos dos Pinhais plant is one of Volkswagen Group s most modern factories worldwide. The unit was built following a pioneer layout: the Body Shop, Paint Shop and Final Assembly areas converge into the Communication Center, a triangle-shaped building where managing offices, internal gardens, restaurants and canteens are assembled.
The unit has an advanced logistic system, with 12 on-site suppliers, which form the Curitiba Industrial Park. Since its opening, the industrial complex has produced more than 2,4 million vehicles for the internal and external markets.
1,300,000 square meters
Workers- 18,500

Curitiba: South Brazil, near to the major port in Porto Alegre
Founded: 1998
Produces: Originally produced VW Fox + Cross Fox since 2003 in Brazil and Latin America
Produced VW Fox, Cross Fox, Bluemotion, Spacefox in Europe 2005-2011- 6 Years of production in Europe but this was stopped in 2011 and this may have affected the factory
Heavily reliant on the internal Brazilian market (and a few Latin American nations)- little international trade
One of VW s most advanced plants- with a current workforce (2015).

New Golf Production in Brazil
In 2015, VW announced that the plant in Curitiba will start to produce the new Golf for the internal market. Investing Euros – 170 around $236 million for the plant
Currently Brazilian customers who want a new Golf rely on imports from Germany and paid extra taxes for this import- Imported cars are required to pay SISCOMEX (Import tax) you then require authorisation from IBAMA (Brazilian Environmental Agency), you must then contact the National transport department. You must then pay the following import taxes Import duty, IPI, PIS, COFINS, ICMS. On average a non-Brazilian made car that is imported will cost around 115% mark up on the price of the car.
The new output in the southern state of Parana will raise Volkswagen’s auto production capacity in Brazil by 20 percent to 1,000 vehicles per day.
As Volkswagen brand’s best-selling car, the Golf is a key model in VW’s plans to boost global sales to 10 million by 2020.

Audi A3 Sedan production
2015 it was announced that the Curitiba plant would be producing the new Audi A3 Sedan for the Brazilian market
In addition to this Audi will begin producing the Q3 at the Curitiba plant soon after- Audi Q3 before its production in Brazil was one of the best-selling premium cars which was imported
These new cars will use newly constructed engines known as Flex-Fuel engines which use gasoline and ethanol because Brazil has the highest use of Ethanol as a fuel resource.
Due to the new Flex-Fuel engine, Audi has trained hundreds of employees at the plant during the marrying up up stage where the engine/transmission is fixed to the body
168 Robots installed for the new model

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