ICDP
Automotive distribution and retailing research, insight, implementation
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ICDP in Brazil

ICDP’s Brazilian research and consulting

Brazil research and consultancy

Brazil has endured a rollercoaster ride economically over the last thirty years and the automotive sector has not escaped this. From expectations that the market would grow to several million units annually, the reality slumped to a low of under 2 million units in 2016 and is only now recovering slowly. Manufacturers have had to rethink their “BRIC” strategy with protected investment and a tolerance of ongoing losses, and dealers have also seen profits collapse, many of them into the red, some to the point of existing the business.

However, Brazil remains a fascinating market, with rapidly developing e-commerce channels, particularly in used cars, offering functionality not seen in other markets. The fortunes of the OEMs vary widely, with some growing share into profitable parts of the market with strong support from their dealer network, whilst others push volume into low margin channels, suppressing the opportunities for their dealers to rebuild and position for the changes ahead. Mobility services have grown rapidly in response to a creaking public transport system and high unemployment levels that have encouraged people to rent cars and offer their services through Uber and local competitors.

Our research and consultancy in Brazil has been focused mainly on the future of the dealer, how they will need to change in order to meet the challenges ahead, and how the manufacturers can help or hinder this process. We have relationships with local partners that date back two decades, and through them and with direct participation from our European team we have been able to map a path forward. We have also hosted Brazilian dealers on study trips to Europe, exposing them to a more relevant dealer environment than that in the US with which they are more familiar. One participant described it as “the best event he had ever attended in his professional life.”

Some of our research (in English and Portuguese) can be accessed through our ICDP Brazil Publications Catalogue available below, with publications available on request from the Project Office.

To discuss research and consulting requirements, please contact icdpbrazil@icdp.net.

ICDP brazil publications catalogue

 

The Brazilian Dealer of Tomorrow Report

This report is available in Portuguese and English and was commissioned in 2017 by FENABRAVE.

Economic recovery in Brazil has brought some renewed optimism, but dealers and OEMs are concerned that the recovery will be pushed off course by the global megatrends that get so much coverage in the media, and wonder what the future is for the dealership model. Our research found that many dealers and OEMs believe that the legacy of the recent recession must be addressed first before attention can be turned to future needs, but we believe that this must be done with a view to future needs as well – what we call changing the wheels whilst driving along. We conclude that there is a future for the dealer model, but to survive, dealers will need sufficient scale to add new skills and capabilities, particularly around digital, and to manage what will be a more complex business in a more process-driven way. OEMs and the dealer associations should support this transition.

The Brazilian Dealer of Tomorrow Report (Portuguese)

The Brazilian Dealer of Tomorrow Report (English)