Nissan is the latest car manufacturer to open a large vehicle research and design center in Brazil, joining the likes of Chevrolet (General Motors), Volkswagen and Renault. The Japanese automaker opened Nissan Design America Rio (NDA-R) in the city of Rio de Janeiro last week. Taro Ueda, Design VP for Americas, according to an article published in the automotive business, explained that the new facilities will investigate the “preferences and the needs of the Brazilian consumer in the field of vehicle design”. These findings will “influence the creation of cars not just in Brazil but also in the rest of the world”, he completed. He also said that the design will focus on new colors because cars are “too monochromatic” and consumers are seeking more variety. This inauguration confirms a few tendencies discussed in Mintel’s Car Retailing – Brazil 2014 report. Firstly, the report findings revealed that 30% of Brazilian adults who have bought a car in the past five years consider “a modern design” one of the key purchase selection criteria. This appetite for innovation serves to justify the investments made by Nissan, Chevrolet and Renault in these research and development facilities. Secondly, it confirms a tendency observed for at least two decades: the shift away from the São Paulo-Minas Gerais industrial axis. In the year of 1990, 99.3% of vehicles made in Brazil were manufactured in these two South-Eastern states, and there were no major design facilities anywhere in the country. Now they are responsible for just 63.1% of cars manufactured in the country. The Nissan design center is the first large one outside the axis – Chevrolet’s, Volkswagen’s and Renault’s are all located in São Paulo. The car retailing industry in Brazil is increasingly dynamic and competitive. Medium-size players and new entrants from all parts of the world are growing car production and distribution networks very aggressively. They are gradually capitalizing on the shortcomings of the more traditional players (Chevrolet, Fiat, Ford and Volkswagen), government subsidies and tax rebates (such as IPI, a federal tax on industrialized goods). The car retailing industry remained largely stagnant between 2009 and 2014, going from R$102.8 billion to R$102.5 billion. This is because cars in Brazil are amongst the most expensive in the world, and consumers would find it extremely hard to extend their credit options any further. Most financial institutions are pulling back on consumer lending. As a consequence, automakers can no longer inflate car prices and expand their margin. Instead, suppliers like Nissan are attempting to increase sales volume through technology and innovation. NDA-R is a testament of this Victor Fraga is Senior Analyst for Mintel’s Brazil report series. He has more than 13 years of experience in industries including technology, healthcare and the public sector. His previous roles have included companies such as Frost & Sullivan, and Guardian News & Media. You might also be interested in: No related posts.