Revista Dealer - Ed 42 - Inglês by Fenabrave mcepress

42 June/July 2013

National Federation of Automotive Vehicles Distribution Bimonthly Publication

RENATO FERRARI The name of the Act

(1924-2013)

The life and struggle of the leader who gave birth and name to Act 6729, which regulates and balances the relationship between assemblers and dealerships in Brazil. The industry of automotive distribution is mourning the loss of this leader, but the struggle to preserve the Act remains as a legacy to all.

Special: See the exclusive interview given to Dealer, by Ferrari, in May of 2012.

23rd Fenabrave Congress and ExpoFenabrave 2013 International Round Table and speech on the Internet are some highlights in the programming.

Success Story

DEBATE

Saga Group is the only company in the automotive distribution on the list of best companies to work for of the Great Place to Work.

Breaking paradigms to profit more from the insurance and extended warranty.

editorial

We are in mourning, but the fight continues Flavio Meneghetti

he Automotive Distribution sector is mourning the recent loss of our inestimable great mentor of Act 6729/79, Renato Ferrari. Former Chairman of Fenabrave, talented lawyer, an impeccable husband and father, Ferrari was, above all, a man of principles and devoted to perfectionism and perseverance that made him to be more than a leader for our industry. He was, is and will remain an example of struggle for ideals worthy and righteous, as was the case of Act 6729/79, current 8132/90 and that deservedly is named after him. The Ferrari Act, as it is known, is alive, vibrant and absolutely necessary for there to be balance in relationships between grantors and concessionaires. As the very Renato Ferrari said, in an interview to Dealer Magazine just over a year, this Act “served to legal constructivism, which was urgent, not only in the automotive sector as in the interest of national development.” Thus, to balance law relations is, and will ever be, in the view ThE NAmE OF ThE AcT of this eternal leader, the path to rightness. We will continue fighting for it, so that the Act 6729 remains in force and is applied, also vigorously, in this sector. Follow, in this edition, a bit about the history of Renato Ferrari, translated into statements from his family members, friends and industry fellows. Deservedly, this great leader receives our tribute of respect in this special edition, edited with more pages, as well as it will name the Auditorium of Fenabrave, which will be called “Renato Ferrari Auditorium”. In addition, in the 23rd Fenabrave Congress his name will be revered with honorable mention and we will, this way, strive, minimally, to give him back the time he dedicated to this sector during 45 years of work in favor of the interests of this Economic Category. I see you at the 23rd Fenabrave Congress! Enjoy your reading and see you soon.

42 June/July 2013

National Federation of Automotive Vehicles Distribution Bimonthly Publication

RENATO FERRARI

(1924-2013)

Special: See the exclusive interview given to Dealer, by Ferrari, in May of 2012.

23rd Fenabrave congreSS and expoFenabrave 2013

International Round Table and speech on the Internet are some highlights in the programming.

SucceSS Story

debate

Saga Group is the only company in the automotive distribution on the list of best companies to work for of the Great Place to Work.

Breaking paradigms to profit more from the insurance and extended warranty.

Flavio Meneghetti is the Deliberative Council Chairman and Officer of Fenabrave – National Federation of Automotive Vehicles Distribution, organization that represents 7,200 dealerships through 49 Brazilian Make Associations.

Dealer Magazine

summary

Bimonthly publication of Fenabrave - National Federation of Automotive Vehicles Distribution. Year 7 – Issue 42 June/July 2013 Board Chairman of Deliberative Council and Board Flavio Antonio Meneghetti President Alarico Assumpção Jr. Vice Presidents Antonio Figueiredo Netto, Edson Luchini, Elias dos Santos Monteiro, José Alberto Gisondi, Mário Sérgio Moreira Franco, Mauricio de Souza Queiroz, Paulo de Tarso Costa Beber, and Paulo Matias “Ad-hoc” Vice Presidents Gláucio José Geara, José Carneiro de Carvalho Neto, Octávio Leite Vallejo, Melchior Luiz Duarte de Abreu and Luiz Romero C. Farias Ex Officio (Former Presidents) Alencar Burti, Sergio Antonio Reze, and Waldemar Verdi Jr. Editorial Board Flavio Meneghetti, Alarico Assumpção Jr., Paulo Engler, Marcelo Ciardi, Valdner Papa, Rita Mazzuchini Editorial and Production MCE – Mazzuchini Comunicação e Eventos R. Frei Rolim, 59 – CEP 04151-000 – São Paulo, SP Phones: (11) 2577-6533 / 5582-0049 E-mail: rita@mcepress.com.br Editor and Journalist in Charge Rita Mazzuchini (Mtb 22128) Assistant Editor Igor Francisco (Mtb 57082)

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Fenabrave TV presents new format for the Course of Correspondents. Special tribute to Wolfgang Sauer. Stay informed of what will happen in the 23rd Fenabrave Congress. And More: meeting in João Pessoa brings together automotive leaders and political authorities. Follow these and other Fenabrave news.

Economy 15

economia

Antonio Corrêa de Lacerda, Doctor and Professor at PUCSP, discusses the lack of competitive conditions more compatible with the current reality in the international economy.

Debate 26

debate

Besides the possibility of compensation in the marketing, insurance can be worked as a valuable tool of loyalty, after-sales and even as a catalyst for new business for Dealerships.

F&I 40

F&I

How to increase profitability through the extended warranty.

Production Line

linha de produç ão

With full installed capacity, Hyundai Brazil gains market space and conquers the 5th ranking position among makes. Learn how assemblers hope to evolve and about the chain role in the country.

Management 46

GESTÃO

Collaborator Daniela Figueira e Luis Massao

Learn the dealership average cost on the sale of a new vehicle. Do the accounting, control operations management and increase profitability.

Graphic Design and Art Edition Heraldo Galan and Patricia Tagnin

Sustainability 48

Photos Marcos Alves e iStockphoto

Compulsory re-registration of Dealerships at CTF from July.

Commercial DNF Comunicação – Gutenberg Soledade Phones: (11) 2281-8134 and (11) 99169-7485 E-mail: dealer@dnfpropaganda.com.br

Success Story

Circulation 9,500 copies Free distribution Correspondence Address Av. Indianópolis, 1967 – Planalto Paulista CEP 04063-003 – São Paulo/ SP Phone: (11) 5582-0000 / Fax: (11) 5582-0001 E-mail: fenabrave@fenabrave.org.br

sustentabilidade case de sucesso

Know how Saga Group builds its strategy through people, becoming one of the best companies to work for.

Legal Support

apoio jurídico

Paulo Engler, Fenabrave Chief Officer, talks about what is fiscal war and what risks it carries.

Editorial staff contact E-mail: rita@mcepress.com.br

Authorization for text reproductions Signed articles in this magazine are of responsibility of the author, and do not necessarily represent Fenabrave opinion. Authorized a total or partial reproduction of unsigned materials, provided the source is mentioned. Reproduction of signed articles and materials must have the author’s prior written consent.

Download this edition of Dealer Magazine on your tablet or smartphone!

Collaborated in this issue: Paulo Engler and Antonio Lacerda

Interview 20 entrevista Reread the full interview given by Renato Ferrari, author of Act 6.729, in May 2012, to Dealer Magazine.

Cover Story matĂŠria de capa 32 The author of the Act 6729, which bears his name, was a tireless leader who devoted much of his life to the interests of the distribution industry. Learn a little more about this great leader on a special magazine of Dealer Magazine.

Launches 56

lanĂ§ amentos

See what is new for the light commercial segment, besides the newest DAFRA 250 cc model.

Revista Dealer

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COAF President participates of interview at Fenabrave TV Since March 1, 2013, came into force the COAF (Financial Activities Control Board) Resolution No. 25, issued on Jan 16, 2013, which sets forth procedures to be adopted by individuals or companies that sell luxury goods, high value goods, or intermediate their sale. The Vehicle Dealers are included in the list of companies that should register or notify the Board, according with transactions performed. To clarify eventual doubts, Fenabrave TV made an interview with COAF President, Antônio Gustavo Rodrigues, aired on May 28, and which counted with the presence of Paulo Engler, Fenabrave Chief Officer, and of Luiz Antonio Fleury Filho, former Governor of the State of São Paulo. “The purpose of that interview with COAF President is to help clarify doubts of all Dealers about the standard applicability. This is a subject that concerns the entire Chain of Dealers for being a subject that involves fighting two activities: money laundering and terrorism. There are several ways to transform this dirty money and put it in the Brazilian financial system; through the Resolution 25 COAF is precisely regulating the fighting of this situation,” clarified Dr. Fleury. Every company capable of selling, purchasing or even intermediating goods above R$ 10,000 is framed in the Resolution 25, but should communicate COAF values above R$ 30,000 only, paid in kind. “The Dealer should be aware that every sale under R$ 30,000 should not be communicated to COAF. It is necessary to keep a record of the transaction, only,” explains Rodrigues. COAF President spoke of the concern of this Board in preserving companies so that they are not deceived. “Every COAF effort aims to protect the companies so that they are not used by criminals. Our concern is that good people are not unwittingly used by a bad guy,” he said. Rodrigues also emphasized the importance of the dealership financial department to be alert at the payment time; however, if the client pays the purchased good through the bank, the institution is the one to inform the transaction to the board. “The Dealer should be alert at the purchasing time, because the client can be malicious and may want to give a stolen check or fake money, so, is you notice something strange you should report to COAF. A person can arrive with a suitcase with a great amount of money and wants to buy a good in cash. Albeit not against the law, the money is not traceable. The payments already made in TED or DOC, run within the financial system, therefore, are traceable, and if there is a high value payment posted to the company account, the bank is the one that should take precautions and be responsible for informing COAF,” he clarifies. According to the former Governor Fleury, by reporting suspicious operations to COAF, “Dealers are complying with the legal 6

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Round Table discusses Information Security On May 21, Fenabrave TV held a round table on “Information Security”. Mediated by Journalist Fátima Turci, the round table was attended by Paulo Engler, Chief Officer of Fenabrave, Marcos Moreira, Officer of F&I Brasil, and João Daniel IT Officer of the company. The program was broadcast live to more than 1.200 reception points of Fenabrave TV, and received several questions on the topic. The Round Table received questions that extrapolated the central topic, and addressed issues on Correspondent’s Responsibilities in the Country and Professionals’ Certification by Dealerships.

João Daniel, Paulo Engler, Marcos Moreira and Fátima Turci.

standard and it does not mean they are suspicious of the client’s honesty. They are only protecting themselves so that if the operation is carried out by someone who is doing money laundering, they will be absolutely covered in its legitimate action for having made a complaint to the Board,” he explained. Rodrigues said that COAF is prepared to verify the 7,200 dealerships and their points of sales in Brazil. “Our system is modern and we are able to do a full job to check out these actions, therefore, we are prepared to serve that sector. “All Dealers must register in COAF. Our system is honest and will not disrupt businesses, as our mission is to prevent problems, therefore, we are have many partnerships with banks and will also count on a partnership with the distribution entrepreneurs,” he added.

Luiz Antonio Fleury Filho, Antônio Gustavo Rodrigues and Paulo Engler.

IPI (Excise Tax) and Inovar Auto in debate On last May 28, a round table was held in São Paulo to discuss the IPI (tax on manufactured products) for the automotive sector and the new regime Inovar Auto. Sponsored by Fenabrave TV, the debate was mediated by Journalist Fátima Turci and attended by Valdner Papa, Fenabrave University and TV educational coordinator, and Celina Ramalho, Economy Professor at Getúlio Vargas Foundation (FGV), Fenabrave consultant. Guests talked about the effects of these measures on the automotive sector. “In the past, the government offered incentives to the sector, such as the IPI reduction in the marketing of vehicles, due to the strong modification that occurred in the market at that time, the reduction of people flow thru the dealership and the decline in sales volume. And, alert to that market behavior, it decided to extend the incentive, provided that on the eve of the incentive expiration sales were heated, but right after they retracted with the gradual tax increase,” said Valdner Papa, adding that such extension, until the end of the year, has two great features: the first one is that, according to the consultant, the prices of vehicles should remain the same until December 31. The second, according to Papa, eliminates the anticipation of purchases, which transforms the market, which will behave without ups and downs, keeping it more stable. Celina Ramalho saw positively the extension of IPI reduction. “In general, I see the IPI incentive as a favorable situation to the sector and understand this government action as a stability to the market; in addition to generating benefits to all, both to the consumer, who can program themselves to buy, and the Dealer, who will always have buyers,” she says.

Fátima Turci, Celina Ramalho and Valdner Papa.

The round table guests also praised the government action in creating Inovar-Auto, new automotive regime, which will apply between 2013 and 2017 and aims to stimulate technological innovation, reduce pollution and increase competitiveness of the Brazilian automotive sector. “For the first time in Brazil there is a rule, which was established by Inovar-Auto. This is an important point for the sector. Another thing is that those who produce in the country will have to comply with the rules to stay here, and this results in better quality products,” argues Papa. According to the consultant, together with Inovar-Auto emerges – in Brazil – a scenario of new experiences of makes and modernization. For the coming years, he believes Brazil is going to become a vehicle exporter country. “In other words, the program will only add improvements to the sector,” adds the consultant. The educational coordinator for Fenabrave University and TV concluded the meeting explaining Fenabrave concern with the sector future, and also the future Dealers. “Fenabrave raises the flag for mobility, but also fights for vehicle recycling and Environment preservation. I believe that the mobility discussion and the recycling discussion have been a priority on the entity agendas and that Dealers and Market in general win with that. For Papa, Inovar-Auto will bring a new shopping behavior for the market, for instance, the migration to 1.4 and 1.6 engines from the 1.0 engine. This motorization represented 60% and lately represents near 40%. This means that clients are migrating to other motorizations,” concluded him.

New format of Correspondents Course From February 2014, it is mandatory that at least one employee of each dealership is certified as “correspondent in the country.” This is a way to guarantee the legality and continuity of the financing transactions performed by dealerships with financial institutions, and follows the standard regulated by the Central Bank of Brazil. Engaged in raising awareness and preparing the Chains employees for the required certification, Fenabrave University, through Fenabrave TV, innovated by introducing a new format for the ‘Preparatory Course for the Certification of Correspondents in the Country’, which will be done online, allowing more flexibility and allowing participants’ interaction. The objective of the course in a new format, started on July 8, is to provide all dealerships with greater flexibility of format without losing driven content. More information by phone (11) 5582-0045 (with Rosana or Amanda) or via e-mail: universidade@fenabrave.org.br

Provided through the Internet, the course has guaranteed two classes held by Fenabrave TV (1st class on Jul 8 and the 2nd on Aug 12), through which the teacher will complement the content, provide important tips to increase the use by the students and provide a better preparation for the general simulated of the course. The investment per person is R$ 300 for the full course. Timetable and operation for the Course of Correspondent First Class (live) through Fenabrave TV

held on July 8, 2013

Release of Module I (Internet)

Jun 8 to 22, 2013

Release of Module II (Internet)

Jun 22 to Aug 5, 2013

Release of Module III (Internet)

Aug 5-19, 2013

Second Class (live) through Fenabrave TV (clarification of questions and tips to perform simulated). Release of General Simulated (Internet)

Aug 12, 2013 Aug 19-23, 2013

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And more... • On May 7, Fenabrave held a meeting with the Make Associations presidents for the motorcycles segment. • Edson Zanetti and Fábio Braz represented Fenabrave, on May 8, at the meeting held by Acrefi and Cetip on the market behavior of vehicle financing. • On May 15, Fenabrave held the Course for Environmental Responsible. Learn more details about it in the Sustainability section of this edition. • Marcello Franciulli, Sectoral Officer of Fenabrave, represented the entity, on May 16, at the 4th Forum of Mobility and Safety on two-wheels 2013, sponsored by Abraciclo. • On June 4, Paulo Engler, Fenabrave Chief Officer, attended the Press Conference for the Efficient Brazil Movement. • On June 6, in Brasília, took place the launch of the Campaign for the Prevention of Traffic Accidents for Professional Motorcyclists held by the Ministry of Cities. Fenabrave was represented by Brenno Alves, institutional relations adviser for the entity.

Dismounting Vehicles Act is approved in the House of Representatives Important step for the regulation of vehicle recycling companies: the House of Representatives approved the Draft Law 23/2011, which establishes rules for the functioning and operation of vehicle dismounting companies in the Country. The text from the Congressman Armando Vergílio (PSD-GO), has undergone changes in its original wording after negotiations with government areas. The matter has now been referred to the Senate. According to the text, dismounting companies shall dedicate themselves solely to this activity, with official registration in the Detran of each State, initially valid for one year and, after the first renewal, for five more years. Existing units that work with dismounting will have three months to adjust to the new law, which, if approved, will enter into force one year after publication. The Union will be responsible for creating a national database of information of dismounted vehicles, the activities carried out by the sector companies and the parts and components intended for replacement, scrap or recycling. This database will be managed and fed by Contran, with free access to all law enforcement. It is also Contran responsibility to define parameters and criteria for used parts – that is, which ones are safe for reuse and those marketing forbidden. The consumer of these parts should receive clear information on the origin and conditions of the product, according to the text of the law. The Detrans will monitor the companies, which will be free to set up the activity prices. These are expect to issue an invoice for the vehicle entry on their premises and in no later than five days request a vehicle registration write off certificate. Dismountings should be done in a ten days maximum, with three more business days to notify the fact to Detran. For the Congressman author of the proposal, the benefits, besides preserving the environment from the improperly disposal of these products, also benefits the safety of citizens, as contributes to the dismantling of gangs of vehicle theft. Information was provided by the Agency of House of Representatives.

Fenabrave mourns the passing of consultant Fenabrave mourns the passing of Fenabre TV and University consultant, Maria Cristina Moreno, occurred on May 13, 2013. The expert, who worked on the makeover of Fenabrave TV since last year, leaves husband and children in São Paulo.

Dealer Magazine

18th Fenabrave Market Relationship Survey and The “The Most Desired Make” Award Fenabrave 18th Market Relationship Survey and the “Most Desired Make” Award, were released on May 27. As in previous years, the Survey will be coordinated by Luiz Adelar Scheuer, Scheuer Consultoria, and split in three parts: General, Make Associations and Segments. The general part consolidated result, questions 1 to 25, will form the General Posture Index and establish the Sectoral Ranking. The consolidated result of the General part first three questions will form the Value Index. Developed based on online questions and answers, the Survey implementation is supported by the Central Services, processed by the IT area and tabulated by the Economic department, which ensures total confidentiality to the content of individual responses, disclosing consolidated results only. “The last survey was a success and we hope the same in this edition that was reformulated. Therefore, we request the Make Associations support the Survey implementation, encouraging Dealers to answer it. Based on the results we will know better the current context of the Vehicle Distribution economic category and highlight the Assemblers that best work in partnership with their Chains,” stated Flavio Meneghetti, Fenabrave Chairman. The Survey result will be disclosed in late July to Make Associations, enabling disclosure and discussion during the Congress

Luiz Adelar Scheuer

specific meetings of each Make. For the purposes of results, Makes with less than five respondents will not be considered. Headquarters of each dealership have already received e-mails with the access ID (password) to respond to the survey at the website www.scheuerconsultoria.com.br The most desired makes – The “Most Desired Make” Award, for the Assemblers of each segment, will be awarded during the Opening Ceremony of the 23rd Fenabrave Congress, to take place on August 7, from 2:30 p.m., at Expo Center Norte, in São Paulo-SP. For the fourth year, the award will highlight the first and second places of the elected makes chosen by online voting and done by dealers of all makes and segments, among the categories “Cars and Light Commercial Vehicles”, “Trucks and Buses”, “Motorcycles”, “Tractors and Agricultural Machinery”, and “Road Implements”.

hours worked in Repair Orders (ROs) USE = available hours By Diego Alvarez Twenty Group Coordinator

Jorge’s work at the auto repair shop Jorge, the mechanic, has 8 hours available for the Repair Shop. During the course of the day, he was allocated to various tasks for 7 hours. He produced and sold by the labor standard time-TMO, 8 hours. What is Jorge’s productivity and use? The Repair Shop manpower is the most vulnerable asset of Dealership. The Vehicle on the yard may be sold at any time. The part on the shelf can be used in the following week. But the manpower available, if not sold on the day, turns into water like an ice stone and no longer can be used.

PRODUCTIVITY =

EFICIENCY =

Low use

8,0

sold hours

8,0

worked Hours

7,0

sold hours

8,0

available hours

8,0

= 88%

= 114%

= 100%

Low Productivity

Lack of good work distribution;

Work poorly distributed;

Mechanic has to go look for work;

Await for parts at site;

Lack of work;

Lack of appropriate tool;

Slow task assignment

Poorly trained mechanic

Possible Solutions

7,0

Possible Solutions

Fixed distribution system;

Distribute tasks to right mechanic;

Use of tracking system or driver;

Facilitate access to parts – mechanic sales person;

Improve sales technique

Analyze and organize proper equipment and tools needs; Identify deficiencies - training

Eficiency in Excess Preference in distribution; Service poorly performed – return is certain; Super mechanic. Dealer Magazine

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Special - Tribute

Wolfgang Sauer: Brazilian by option German-born naturalized Brazilian Wolfgang Sauer, who headed Volkswagen of Brazil in the 1970s and 1980s, died on April 29. He left wife, two daughters, three grandchildren and valuable lessons of entrepreneurship, courage and leadership. The name did not deny its origin: Wolfgang Franz Josef Sauer was born on German soil, in the city of Stuttgart, known for hosting the world automotive giants, such as Porsche, Mercedes-Benz and Bosch. However, even before the age of 30, he had already started his journey out of the country of origin, living in places like Portugal, Venezuela and Argentina. He arrived in Brazil in 1961, at age 31, became a naturalized citizen and lived here until his death on April 29, 2013. Considered one of the pillars of the automotive industry consolidation in the Country, Sauer leaves a legion of admirers. “Sauer is recognized for being the great leader of the Brazilian automotive industry for a long period of our history. He was a person that, even going against some opinion, could explain the reason for the negative in such a way that the antagonized person would understand his position and help him in his mission,” says Sérgio Reze, President of Assobrav (Brazilian Association of Volkswagen Distributors). The argument was intrinsic – and necessary – to Sauer. Even because, without it, the executive would not be able to convince his colleagues at Volkswagen to discontinue the Beetle, one of the icons of the make in the Country, or even prove that it was possible to export profitably - in full 1980 - cars to the Middle East, a region that absorbed nothing less than 170,000 vehicles manufactured in Brazil in a commercial operation that defied logic, with payments made in oil and logistics designed to bypass Iran-Iraq war conflicts. Sauer’s ability to perform complex and sometimes improbable maneuvers marked his management ahead of Volkswagen, company he led between 1973 and 1989. The greatest example of that might have been the creation of Autolatina, a joint venture that united Ford and Volkswagen, two of the planet leading assemblers, on a project-sharing technologies, products, workmanship and control systems. The partnership lasted until 1996. Sauer also participated in the creation of Volkswagen National Consortium and of the starting of truck production line of the assembler. During his tenure, models of success were launched, such as Gol, Voyage, Parati, Saveiro, Santana, and Passat. In addition, he was able to export national vehicles to almost a hundred countries, including the demanding Japanese market, and led the Santana manufacturing to China, where the model is still being produced. Easy transit – Another fantastic trace of Sauer was his easy transit among government members – he was an habitué of presidential 10

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Wolfgang Sauer, CEO - Volkswagen of Brazil - between 1973 and 1989.

offices – and among factory employees, being one of the major responsible for the development of relations among companies and unions in the 1980s – he followed closely the political birth of the former President Luiz Inácio Lula da Silva. This ability has caused him to conquer important political victories for the automotive sector in a difficult time for the Country economy. “I remember that during the Cruzado Plan, due to the prices freeze, assemblers lost in volume and could not increase production. It was a time of scarcity, of premium collection, and Sauer’s interlocution with Dealers, through Assobrav, was essential for us to go through that moment the Country lived. Together, we assessed the plant needs and finally managed to get the government to relinquish the freezing for the sector. Great man, who had magnificent moments,” concludes Reze.

Paraíba hosts Meeting of Management Board and Regional Executive Boards City known as “Where the sun rises first”, João Pessoa, capital of Paraíba hosted, on last June 7, the statutory meeting of Management Board and Regional Executive Boards of Fenabrave. Greeted by Paulo Guedes, Officer of Regional/PB, and José Carneiro Carvalho Neto, President of Sincodiv/PB and Vice President of Fenabrave, the members of the management board and regional boards stood by the Executive President of National Fenabrave, Alarico Assumpção Jr., who represented the Chairman of the Board and Officer of the entity, Flávio Meneghetti, absent due to a recent surgery. In the opening of the meeting, there was the Secretary of State of the Federal Revenue of Paraíba, Marialvo Laureano dos Santos Filho, and the Secretary of Tourism of João Pessoa, Roberto Brunet. Among the authorities, there was also present the Minister of Cities, Aguinaldo Ribeiro, who participated of the closing of the event, when he thanked and praised Fenabrave support to PARADA Federal Program, focused on actions for a safer traffic throughout the Country, and commented on the importance of the sector for the growth of Brazil and infrastructure investments to be made soon by the Government. Marialvo Laureano also highlighted, to the leaders of the automotive distribution sector, the infrastructure actions and Paraíba regional development policies to attract new investments in the automotive sector in the region. “With the paving works on state highways, until the end of 2014, more than 52 municipalities in Paraíba will be integrated to the state development route and new investments should also happen through the installation of car dealerships,” on behalf of the Governor of Paraíba, Ricardo Coutinho. For Fenabrave Vice President, José Carneiro, “the presence of political authorities in the event demonstrates the importance of the automotive sector for the State, and the willingness of Fenabrave to hold part of the statutory meetings in other regions of the Country, not only São Paulo, shows the regional capillarity and importance the Federation has in Brazil.” In his opening speech, Alarico Assumpção Júnior made a general assessment of the sector in the country, pointing to forecasts for the year, considered to be positive even if the estimated Domestic GDP does not reach the ratio expected by the Government, above 3%.

The Executive President of the entity also commented on the problems faced by the motorcycle segment, still hit by the credit restriction, and the storage issue of medium trucks, but stressed the importance of the New Automotive Regime, the INOVAR AUTO, for the development of new products. On the agenda of the day, were addressed subjects like the COAF Resolution 25, Correspondent in the Country, Vehicle Recycling, New Fenabrave Market Relationship Survey, Transitional Vehicle Possession, creation of the Work Committee in partnership with ANFAVEA, Education of Environmental Responsible in the Dealerships, Fenabrave Portal, Fenabrave Universidade/TV, 23rd Fenabrave Congress/ExpoFenabrave, and other topics of general interest, such as Direct Sales, topic addressed by Dr. Adalberto Eyng, Coordinator of GESAUTO – Specialist Group of Automotive and Autoparts Sector of the 1st GERFE – Secretary of State of Finance of Florianópolis-SC. The press reported the event and Fenabrave Executive President, Alarico Assumpção Júnior, was featured in the Correio da Paraíba newspaper and in a live program aired by Tambaú TV, SBT rebroadcast station in the city of João Pessoa and that includes contend simultaneously on Tambaú radio and Portal. In addition to the intense meeting program, Paraíba hosts filled the participants staying period with moments of relaxation and leisure. Cabedelo region received the entourage to show the beautiful “Sunset” to the sound of Ravel’s Bolero, played by the traditional - and famous in the region - sax of Jurandy and, on the eve of the return of all to their cities of origin, they enjoyed a catamaran ride on Red Beach (Praia Vermelha) and a visit to Campina Grande, where it is annually held the world largest festival of Saint John. Not to mention the typical meals organized by the hosts, including the traditional ‘Gororoba’ and the Guava (Goiabada) Petit Gateau. “Fenabrave must have at least one meeting per year here in Paraíba. If not the statutory, it can be the extraordinary,” joked José Carneiro. According to Paulo Engler, during the 23rd Fenabrave Congress, to take place on August 7-9, at Expo Center Norte, in São Paulo, Fenacodiv will hold a meeting with all Sincodivs executives, in order to exchange experiences and discuss various issues related to the entity union.

Fenabrave leadership gathered in João Pessoa. At the center, the Minister of Cities, Agnaldo Ribeiro.

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International Round Table and speech on the Internet are some highlights in the Fenabrave Congress programming The international market affects Brazilian economy and automotive business. More than that, the international experience of mature markets can guide our business, alerting to watch out and pointing out more profitable paths, enabling us to overcome difficulties. Thinking on how other countries view and overcome their challenges with vehicles sector, on August 7, at 11:30 a.m., the International Round Table will be held during the 23rd Fenabrave Congress, with the theme “World automotive market and the vision of Brazil.” The main world leaderships of automotive distribution sector, such as the President of NADA (National Automobile Dealers Association, David Westcott, and the Chief Economist of MCVean Trading (USA), Michael Drury, will attend the event to show the global automotive movements and how they can influence the market behavior in Brazil. More than

that, experts shall point opportunities to the Brazilian market. Thiago Machado, Officer

With an eye on the Web – An- for Automotive Industry, other speech that should draw Google Brazil. Dealers’ attention is themed ‘Consumer informed: how the Internet helps in every step until the arrival at the dealership’, to be delivered by Thiago Machado, Business Officer for the Automotive Sector, Google Brazil. This speech will address the possibilities the online world provides for the automotive sector, and how is this path between the launching of a new model until the consumer’s arrival at the dealership. In which moment does the Internet assume different roles along the selection process by which passes a car buyer?

Come check out these and other speeches on www.congresso-fenabrave.com.br 23rd Fenabrave Congress and ExpoFenabrave 2013 August 7-9, at Expo Center Norte, in São Paulo-SP

Dealer Magazine

More incentives from Make Associations Aiming to encourage their affiliated dealers, Make Associations are increasingly committed to making the entire Chain participate in the 23rd Fenabrave Congress.

Other Make Associations are also encouraging their chains, such as ABRAC, ABRANOMA, ABRACAF, AUTOHONDA, ABRARE, and ABRACIT.

ABRAVO – Brazilian Association of Volvo Distributors will pay one registration for each headquarters of Volvo Truck Chain. “We understand that Fenabrave Congress is an event that every year gets more consolidated and strengthened as a generator meeting of a lot of information on our market. It is a great opportunity to exchange experiences to all those who work in the vehicle distribution market in our Country. This is the reason that motivates us to encourage the participation of all leaders, officers, managers and employees of dealerships, as we have no doubt as to the professional and technical gain it represents,” says Ricardo Pamplona, President of Executive Board of ABRAVO. ABRADIT – Brazilian Association of Toyota Distributors offers 30% discount on registration for the Chain participation.. ABRAFORTE - National Association of New Holland Dealers, purchase registrations and already booked a room to gather its Chain during the event. “For us, the segment of agricultural machinery, Fenabrave new proposal and vision to take to the Congress an approach that addresses the needs of this segment makes clear our importance within the domestic economic scenario and representation within this Federation. We understand that our Dealers’ participation provides an unique opportunity to bring into our business information and knowledge that can really contribute to the development of the activity. To encourage our Chain participation, at each edition, ABRAFORTE offers one registration per Dealer,” comments Renato Venturoli Pinese, President of ABRAFORTE.. ASSOBRASC - Brazilian Association of Scania Dealers purchased 20 registrations for their leaders’ participation in the event. ABRADIF – National Association of Ford Dealers negotiated with Fenabrave special conditions to provide 30% discount in registrations. To use this benefit, the make dealerships shall make their registrations at the Congress Service Center at the telephone number: (11) 5582-0091. “Fenabrave Congress is mandatory for all those who live the daily life of a dealership – after all, it is the event of our sector, where we learn new ways to work and manage the business. ABRADIF has encouraged Ford Dealer professionals to participate, through promotional registrations discounts, in addition to publicizing on a weekly basis the event in the entity newsletter,” said Sergio Zardo, President of ABRADIF. UNIMASSEY- National Association of Massey Ferguson Dealers and ASSODEERE - National Association of John Deere Dealers, purchased a quota of registrations for their Chains. ABCN - To encourage Nissan Chain to participate in the Congress, ABCN - Brazilian Association of Nissan Dealers, is paying one person’s registration per headquarters and, should more people be willing to participate, an additional registration will have 40% discount. A ABRACASE - Brazilian Association for Dealers of Case IH Brazil, purchased registrations for the associated dealerships headquarters and has already confirmed a make meeting at the Congress.

Dealer Magazine

radar fenabrave

Drops Assoaudi has a new President Assoaudi - National Association of Audi Dealers has a new president after the resignation of Mr. Aldo Biaseppon Netto. The Vice President of the entity, Carlos Roberto Franco de Mattos Jr., takes the office until December 2013.

Assomit elects new president Elected for the biennium 2013/2015, Rafael Maurício de Gouveia, is the new President of Assomit – National Association of Mitsubishi Dealers.

Argentinean Association of motorcycles visits Fenabrave On May 7, Fenabrave was visited by representatives of Asociación Argentina de Motovehículos – Mottos, of the two-wheel segment. Marcelo Diego Dinitz, President of the entity, Walter Lastra, Vice President, and Damián Szapkievich, Executive Officer, were welcomed by Alarico Assumpção Jr., Executive President of Fenabrave, Antonio Figueiredo Netto, Vice President, and Marcelo Franciulli, Fenabrave Sectoral Officer.

On the last May 26, at the headquarters of Fenabrave, the entity welcomed Make Associations and Sincodiv/ Fenabrave Regionals advisers for the Communication Strategic Meeting, held under the coordination of Rita Mazzuchini, adviser of institutional communication and press of the entity.

XVII Cenassobrav happens in Germany

The purpose of the meeting was to discuss Fenabrave Strategic Planning of 2012-2014, developed in 2012, where were traced strategies of communication covering press agency services of Make Associations and Regionals. “The central focus was to establish a positive agenda among us, strengthening the relationship and aligning the structure and responsibilities among advisers and spokesmen for the sector, according to the issues related to each segment, make or even in relation to the sector in general,” says Rita Mazzuchini.

Fenabrave Executive President, Alarico Assumpção Jr., and the organization Chief Officer, Paulo Engler, attended the XVII Cenassobrav – Assobrav National Convention (Brazilian Association of Volkswagen Dealers), held on May 26-31, in Berlin, Germany.

Fenabrave participates in Automotive Dealer Day Fenabrave President, Flavio Meneghetti, participated in the Automotive Dealer Day, held on May 14-16, in Verona, Italy. Meneghetti participated of a round table with David Westcott, President of NADA, Charlotte Ye, International Officer of CADA (China Automobile Dealers Association), and with Leonardo Buzzavo, President of Quintegia, the Dealer Day organizer. This year, the event had 4,350 participants, 90 companies of automotive sector, besides the sector leaders and the coverage of over 100 journalists.

Leonardo Buzzavo, Flavio Meneghetti, Charlotte Ye and David Westcott.

Strategic Meeting of Communication and Press

Dealer Magazine

One of the planning targets, in terms of communication and press, is to strengthen the sector image in the market, giving autonomy and visibility to all leaderships, according to their capillarity and representativeness, guiding the role of each one in this context, as National Fenabrave and Fenabrave and Regionals, and Make Associations. Attended the Meeting: Fenabrave – Rita Mazzuchini, Daniela Figueira, Paulo Engler, Edson Zanetti, and Patrícia Monrroy, ABRAC – Fiorella Fatio, ABRADIF – Célia Domingues, ABRADIGUE – Karen Cunha, ABRAVO – Francisco Garcia, ASSODEERE – Ana Carolina, Rejane Hermann, FENABRAVE DF – Flávio Resende, FENABRAVE ES – José Francisco Costa, FENABRAVE MS – Paulo Cruz, FENABRAVE PR – Suzane Marie, FENABRAVE RN – João Ferreira, FENABRAVE RS – Karen Cunha, FENABRAVE SC – André Andreazza and Bianca Aline – SINCODIV SP – Caio Rinaldi.

economy

Challenges for the Brazilian economy

Antonio Corrêa de Lacerda

The response of Brazilian economic policies during the period of crises after 2008 has several merits. However, despite the undeniable hit in the direction taken, we still lack conditions of systemic competitiveness more compatible with the current reality of international economy.

he response of Brazilian economic policies to the major global economy ongoing changes in the post-2008 crisis period has several merits. The adoption of countercyclical measures prevented a greater contagion of deleterious effects of the activity fall, first in the U.S. economy, and more recently the European economy, as well as the policies and actions that have been implemented by these countries. Since then, the Brazilian government took significant measures: introduced macro prudential measures to better equip monetary policy, adopted measures to control international capital flows, reduced interest rates and devalued currency exchange and adopted unburdening measures of taxes and charges on final products, inputs, such as electric power and payroll. However, despite the undeniable hit in the direction taken, we still lack systemic conditions of competitiveness more compatible with the current reality of international economy. There are structural issues involved since the intensification of globalization of the last decades, now aggravated with the production surplus in many countries, trade and currency wars under way. The panorama described intensifies the need for adaptations and adjustments. Despite the drop in interest rate, for example, the levels practiced in Brazil are still making the capital cost - either for financing or for credit - very high compared to international standards. In the currency issue, albeit there was a devaluation of Real, other countries have also caused the devaluation of their currency. Furthermore, many of the tax exemption measures and reduction of financial charges have limited validity term, which contrasts with the conditions offered to our competitors, especially China and South Korea, countries that adopt state policies of encouragement to productive investments, innovations and exports. It is also very important to have a strategic vision for the longer term and that includes a set of policies and actions to

provide better competitiveness conditions for Brazilian economy. That is what will ensure that our substantial potential of consumption generates investments decisions to increase local added value, to foster innovations and expand export platforms of manufactured products. Hence the importance of the processes timing notion. Many of the ongoing measures will present results in mediumterm only. The low growth in 2012, when GDP rose 0.9% only, which prevails in this first half of 2013, intensifies agents’ anxiety. However, it is very important that the frustration with the lack of immediate results does not lead to a reversal of the current route. In many cases, you will need persistence, especially in face of such a complex international scenario as what we are experiencing. Although the short-term economic growth is leaving much to be desired, there is the ongoing impact of the macro prices changes. After a long period of currency exchange persistently valued and interest rates excessively high, the entire economy structure was adapted to those circumstances. This is a natural agents’ survival movement that despite being justifiable under the microeconomic point of view it is unsustainable for the Country. Although we have good indicators of sound macroeconomic fundamentals, the growing deficit in current account of the payments balance, which reached USD 70 billion in the last 12 months, is worrisome, not so much for its absolute and even relative dimension, but due to the speed of its growth. The ongoing route correction in Brazil brings costs, including loss to a short-term growth, many times combined with spotted inflationary pressures. However, from the new base, the results will present better quality. A dynamic and continuous process that does not end by itself. We must take all necessary measures to protect and strengthen our defenses, besides implementing active strategies of inclusion, considering the new circumstances.

Antonio Corrêa de Lacerda is Professor and Doctor of the Program of Postgraduate Studies in Political Economy at PUC-SP, Doctor by the IE/Unicamp. Email: lacerda.economista@gmail.com

Dealer Magazine

Quarta-Feira | 7 de agosto de 2013 HORÁRIO 08h00

Credenciamento e Abertura da ExpoFenabrave

08h30-10h30

AUTOS Seminário Especial J.D. Power Jon Sederstrom, Diretor, J.D. Power Brasil Palestra internacional Charles Mills, Vice-Presidente, J.D. Power and Associates, EUA

08h30-13h00

GERAL | SEMINÁRIO F&I Os impactos das receitas de F&I no resultado do concessionário Welson Bolognesi, Presidente, Resource Automotive Como integrar vendas e F&I Luciano Groch, Diretor, Assurant Solutions Os caminhos para alta performance em F&I Daniel Brandão, Diretor Comercial, F&I Brasil Plano de remuneração de F&I Carlos Brant, Diretor, JM&A Os novos produtos de F&I em vendas e pós-vendas Marcella Verdi, Vice-Presidente, Usebens F&I na geração Y - Palestra internacional Tony Dupaquier, Diretor de Treinamento, F&I American Services, EUA

09h00-10h30

TRATORES E MÁQUINAS AGRÍCOLAS O mercado de usados no Brasil: desafios e oportunidades Marcelo Kozar, Diretor Grupo Via Máquinas

10h30-11h30

Coffee-Break e Visita à Exposição

11h30-12h45

AUTOS | MESA REDONDA INTERNACIONAL O mercado automotivo mundial - Palestra internacional Michael Drury, Economista Chefe, MCVean Trading, EUA Participação: Flavio Meneghetti, Presidente, FENABRAVE David Westcott, Presidente, N.A.D.A. (EUA) Charlotte Ye, Diretora, CADA (China) CAMINHÕES, ÔNIBUS e IMPLEMENTOS RODOVIÁRIOS | NOVOS BNDES – linhas de crédito Samy Kopit, Assessor da Diretoria, BNDES GERAL Indicadores de RH – oportunidades para aumentar as margens da Concessionária Francisco Nunes, Consultor, Business Assessoria Empresarial AUTOS | MESA REDONDA A importância da internet no mercado automotivo Moderador: Sylvio Alves de Barros Netto, CEO, iCarros

12h45-14h00

Almoço

14h30

Cerimônia de Abertura Solene

16h00-17h00

GERAL | PALESTRA MAGNA Talk Show Vicente Falconi, Conselheiro e Sócio-fundador, Falconi Consultores de Resultado

17h00

Coquetel e Visita à Exposição

19h00

Encerramento

Informações e Inscrições: 11 5582 0091 | congresso2013@fenabrave.org.br | www.congresso-fenabrave.com.br

Quinta-Feira | 8 de agosto de 2013 HORÁRIO 08h00

Credenciamento

08h30-09h45

AUTOS Mercado de usados: tendências e lucratividade Jon Lancaster, Consultor, Lexus of Madison e Lancaster Toyota Valdner Papa, Coordenador Temático do Congresso e Responsável pela Divisão de Educação Corporativa da Fenabrave GERAL Caso de sucesso: gestão corporativa e sucessão Marcos Roberto Cruz, Presidente, Empresas Canopus Participação: Fernando Curado, Presidente, Msci Governança e Estratégia Maria Cibele Crepaldi dos Santos, Sócia, Siqueira Castro Advogados CAMINHÕES, ÔNIBUS E IMPLEMENTOS RODOVIÁRIOS Nova regulamentação da atividade de motorista Flavio Benatti, Presidente, NTC GERAL Uma história de sucesso em um mercado desafiador - Palestra internacional Edwin Derteano Dyer, Presidente, AAP-Asociación Automotriz del Peru, Peru GERAL Tendências e perspectivas para o varejo Maurício Morgado, Consultor, Fundação Getúlio Vargas Coffee-Break e Visita à Exposição

09h45-10h30

GERAL | ECONOMIA Os desafios da transição de modelo de desenvolvimento Ricardo Amorim, Presidente, Ricam Consultoria CAMINHÕES, ÔNIBUS e IMPLEMENTOS RODOVIÁRIOS O futuro da logística no Brasil Paulo Fernando Fleury, Diretor Geral, ILOS - Instituto de Log. e Supply Chain GERAL Liderança coaching - razão, alma e coração José Rafael de Medeiros, Diretor, JRM Inovação Empresarial AUTOS | SERVIÇOS Absorção máxima do pós-vendas Alessandro Soldi, Diretor Comercial, Saga TRATORES E MÁQUINAS AGRÍCOLAS Pós-Vendas: a necessidade do lucro Francisco Mendes, Consultor, Francisco Mendes Consultoria Automotiva

10h30-12h00

Almoço e Visita à Exposição

12h00-14h00

GERAL Grupo dos 20: melhores práticas em serviços - Palestra internacional Lee Harkins, Presidente e CEO, M5 Management Services Inc. CAMINHÕES, ÔNIBUS E IMPLEMENTOS RODOVIÁRIOS O futuro da distribuição em caminhões Alexandre Mendonça de Barros, Sócio-Consultor, MB Agro Tereza Maria Fernandez Dias da Silva, Diretora, MB Associados MOTOS Desafio para rentabilizar o negócio de motocicletas Francisco Trivellato, Consultor, Trivellato Informações e Estratégias TRATORES E MÁQUINAS AGRÍCOLAS Tendências dos mercados agrícolas no Brasil e mundo no ciclo 2013/2014 e os impactos na produção e demanda de máquinas agrícolas no Brasil Carlos Henrique Cogo, Sócio-Diretor, Carlos Cogo Consultoria Agroeconômica GERAL | MIDIA SOCIAL Consumidor informado: como a internet ajuda em cada etapa até a chegada à concessionária Thiago Machado, Diretor de Negócios para Indústria Automotiva, Google Brasil

14h00-15h15

Coffee-Break e Visita à Exposição

15h15-16h15

AUTOS O Futuro da Distribuição de Autos Thomas Schmall, Presidente, Volkswagen do Brasil

16h15-17h30

CAMINHÕES, ÔNIBUS e IMPLEMENTOS RODOVIÁRIOS Meio ambiente e sustentabilidade: oportunidades e desafios Luiz Carlos Correa Carvalho, Presidente, ABAG, Associação Brasileira do Agronegócio GERAL As novas ferramentas de gestão Roberto Fontes Philippi, Dealer, Smart Dealer Soluções em Software GERAL Liderança natural, a liderança invisível Wilson Britto, Escritor, Consultor, especialistas em gestão empresarial e formação de lideranças MOTOS | PEÇAS Maximizando o lucro em peças Wagner Kmite, Consultor, Kmite Treinamento e Desenvolvimento Gerencial 17h30

Encerramento

Informações e Inscrições: 11 5582 0091 | congresso2013@fenabrave.org.br | www.congresso-fenabrave.com.br

Sexta-Feira | 9 de agosto de 2013 HORÁRIO 08h00

Credenciamento

08h30-11h00

GERAL | SEMINÁRIO RH Negociação sindical: como se inicia, pontos relevantes, avaliação dos itens, sugestões Octávio Leite Vallejo, Presidente, Sincodiv-SP Recursos Humanos: a visão da montadora Carlos Morassutti, Vice-Presidente RH, Volvo Remuneração: importância, cargos e salários, modelo ideal, pesquisa salarial, turnover Ricardo Mota, Diretor RH, UAB Motors Qualificação de mão-de-obra Marcos Magalhães, Presidente, ICE – Instituto de Co-Responsabilidade pela Educação O resultado é uma questão de gestão: papel do líder, vender e vender com qualidade Paulo Carvalho Engler Pinto Jr., Diretor Superintendente, Fenabrave MESA REDONDA Alarico Assumpção Jr., Presidente Executivo, Fenabrave Luiz Edmundo Prestes Rosa, Diretor de Educação, ABRH Pedro M. Martins, Chairman, Euro American Business School – EABS

10h00-11h00

Coffee-Break e Visita à Exposição

11h00-12h00

GERAL | MIDIA SOCIAL Caso prático: apresentação Facebook for business Fabrício Proti, Diretor de Negócios, Facebook GERAL Desafios governança corporativa no varejo automotor Marcelo Prado, Fundador e Sócio, MPrado Consultoria Empresarial Wanderson Rodrigues da Silva, Consultor, MPrado Consultoria Empresarial GERAL - MESA REDONDA Concessionária: um novo negócio Moderadora: Denise Campos de Toledo, Jornalista Debatedores: Flavio Meneghetti, Presidente, FENABRAVE Jorge Chear Neto, Diretor de Vendas e Marketing, Ford Roberto Y. Akiyama, Diretor, Honda Automóveis do Brasil GERAL | PALESTRA MAGNA DE ENCERRAMENTO Silvio Meira, consultor, palestrante motivacional especializado em criatividade e inovação

12h00-13h00

Concurso Cultural. Premiação de 5 IPads 13h00

Brunch

14h00

Encerramento

Destaques

Charles Mills

Jon Lancaster

Lee Harkins

Valdner Papa

Alessandro Soldi

Silvio Meira

Francisco Trivellato

INTERVIEW

Dealer Magazine

Renato Ferrari

The point of balance In May 2012, a year before his death, Renato Ferrari gave an exclusive interview to Dealer Magazine, commenting on the personal and collective motivations that made him strive in the name of an Act that, according to him, “served the legal constructivism, which was already urgent, not only in the automotive sector, but also in the interest of national development”. To balance law relations is, and will ever be, in the view of this eternal leader, the path to rightness. Check out the reproduction of the interview, in full, given by email, by Renato Ferrari at the time. As a true gentleman, not even the failing health prevented him from answering the questions in detail and with perfectionism that has always been his trait of profile. “Excuse-me, I would love to welcome you at home for this interview, but unfortunately I do not have conditions for that. However, I would never fail to meet your request,” said Renato Ferrari on the phone to the publisher of Dealer Magazine who, like many, feels honored to have known this true and unforgettable example of leadership and perseverance.

Dealer Magazine

INTERVIEW

Dealer Magazine – What motivated Fenabrave to fight for the creation of the Act 6729/79? Renato Ferrari – The first thing that was necessary was to give a proper definition to the professionals who exercised the activity, basically, considering its structuring. Their commercial, financial, technical and administrative complexities; their expressive investments and working capital; the chaining of production and distribution links; the distinction between production and distribution of new automotive vehicles and respective parts and accessories, with technical assistance and considering numerous other factors, such as high social contribution of thousands of jobs and large sums of tax nature; and

It (The Act 6729) is the certificate of a fundamental chapter in the relations of the economy as a whole, involving relevant segments. Its structure and objectives form an exemplary element in the scenario of relations among its segments and constitutes a force for these durable goods consumers and their defense.”

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considering the clear difference between distributors and marketers of automotive vehicles in general, operating as a simple sale, without the conditions and responsibilities of those who practiced the distribution. For this definition, the subject was first brought before the competent authority, which defined the Distributors of Automotive Vehicles as an Economic Category of specific nature, configuring the exercise of this activity by commercial concession, according to Resolution issued by Ministry of Labor under the No. 312.943-75, of August 25, 1975. Therefore, it was defined and named the Economic Category of Automotive Vehicles Distributors, legally characterized by commercial concession, a subject never taken care before. Dealer Magazine – What are the main Act advantages/benefits for the dealers of automotive vehicles? Renato Ferrari – The Act conquest required a continuous effort from us, from 1975 to its completion in late 1990, either in the National Congress or in the Executive Branch. In its complex of provisions and clauses, its fundamental principle was the legal balance between the parties, who operate by the commercial concession contract, before the sharp economic difference between producers and distributors. There are no advantages, benefits or favors to the distributor, but only legal balance between parties. Dealer Magazine – The Act underwent minor changes in 1990, giving rise to the Act 8132/90. Do you consider this Act should deserve further adjustments, or is it still current?

Renato Ferrari – The Act has undergone minor changes introduced by the Act 8132, of December 26, 1990. There were some minor modifications and some revocations of some articles. This procedure did not alter the substance of the Act, as the changes were devoid of content, to begin with the lack of necessary knowledge of commercial concession by the author or authors of this procedure. Dealer Magazine – What is the importance of being maintained? Renato Ferrari – The Act should be maintained as it is, by its very nature and its relevance to the matter in question, it constitutes a systemic unit in which all provisions are indispensable. It is the certificate of a fundamental chapter in the relations of the economy as a whole, involving relevant segments. Its structure and objectives form an exemplary element in the scenario of relations among its segments and constitutes a force for these durable goods consumers and its defense. It is unthinkable that the Act could cease to exist. Its inexistence would result in a source of damages and losses of different nature to the production, distribution and consumption of goods in question, injuring its systemic unit, with continuous conflict between parties, for lack of disciplinary rules, dictated by the most prominent as occurred before its conquest. Dealer Magazine – Among the articles of Act 6729/79, cite at least three that considers fundamental and justify. Renato Ferrari – In the overview of the Act, all its provisions are fundamental, featuring a complex of inseparable

In its complex of provisions and clauses, its fundamental principle (Act 6729) was the legal balance between the parties, who operate by the commercial concession contract, before the sharp economic difference between producers and distributors. There are not advantages, benefits or favors to the distributor, but only legal balance between parties.”

elements, so it would be inappropriate to prioritize items, and also the highlights could be variable according to different criteria. Notwithstanding, remember conceptual provisions of legal highlight, as exemplified by Art. 1 that established the commercial concession as a mandatory legal means for the distribution of land automotive vehicles; Art. 2, which defined the distributor, understanding the word Distributor as an economic link and the word Dealer as a legal figure, and the word Producer also as an economic link and the word Grantor also as a legal figure; Art. 17, which established the Convention of Economic Categories represented by the respective associations of producer and distributors, and the Convention of Make among each producer and its Chain of distribution represented Dealer Magazine

INTERVIEW

by the respective Association, all force of law conventions covered. Dealer Magazine – Fenabrave, for some years, has argued that the direct sales, as practiced by assemblers nowadays and that represent more than 30% of industry sales, are contrary to the provisions of Act 6729 to the extent that they are not only carried out in volume above the established, as well as in lower prices than the those granted by assembler to dealerships (assemblers even offer more than 25% of discount to fleet owners against a 11% margin for dealers). Do you agree

“The grantor-producer offers, in direct sales, huge discounts, and has resorted so many times to it that ended up creating a parallel distribution channel, which hurts the Act and the Convention, with marked impairment to the distributorDealer, whose situation demands an urgent solution.” 24

Dealer Magazine

with the plea of isonomy by Fenabrave? How can the so-called “direct sales” hurt the Act 6729? Renato Ferrari – Among other operating-nature provisions, we have Art. 15 of the Act and the articles 1 et seq of Chapter XVII of the First Convention of Economic Categories, of December 16, 1983, that in the case of direct sales from producer to consumer, specify the exceptions and conditions under which can be performed. Among such conditions, the price that the grantor-producer can practice in these sales increase, and they are forbidden to offer the consumer lower price and advantages contrary to the rights and interests of the distributor-dealer. It has become of public knowledge that these prohibitions have not been respected, the market knowing that the grantor-producer offers, in direct sales, huge discounts, and that has resorted so many times to it that ended up creating a parallel distribution channel, which hurts the Act and the Convention, with marked impairment to the distributor-Dealer, whose situation demands an urgent solution. This synthesis cannot neglect the root cause responsible for multiple effects against the institute of commercial concession, which consists of a producer manufacturing quantities above the actual consumption capacity, and often in great excess. While this imbalance exists, insulting the old law of supply and demand, it will not cease the source of troubles and of damages and losses of the distribution segment, whose anomaly also raises urgent correction.

Results

Revenue

Fenabrave

debate

Cultural change ensures profit in insurance In the opinion of specialized companies, Dealers must break paradigms, implement a department dedicated to F&I and pay more attention to Insurance products in order to increase their results.

Dealer Magazine

I Travis Mazza, Vice-President of JM&A Brasil, Paulo Souza Lima, Commercial Chief Officer of Resource Automotive, and André Luis Cuque, Markets Chief Officer of MAPFRE Warranty.

t is not new the fact that car Dealers work with margins increasingly reduced and face difficulties to profit from financial products that in the past accounted for a significant portion of the company profit. It is also well known by the industry entrepreneurs that the gain with the “I” (insurance) of F&I has not yet reached full potential in the Brazilian authorized Dealerships. This scenario may seem heartbreaking, but leaves a clear road to be travelled by the Dealers operating in the Country: it requires a change in the dealership culture and a greater focus on marketing Insurance products. At least, this is the view of two of the major players in the market: Travis Mazza, Vice-President of JM&A Brasil, domestic arm of one of the largest financing and insurance companies of the automotive industry in the United States (JM&A Group), Paulo Souza Lima, Commercial Chief Officer of Resource Automotive, and André Luis Cuque, Markets Chief Officer of MAPFRE Warranty. “The most significant cultural change is to direct the same efforts that are strictly focused on selling cars and ‘F’ (Finance) to ‘I’ products, more specifically the extended warranty, which can generate additional revenue. Our partners have found high revenues generated through the extended warranty. Another key factor to increase the ‘I’ is the ability to fund these products. The sales penetration rates increase when the client is offered the option of long-term payment,” analyzes Mazza, noting that the change requires dedication to the F&I process by all departments and teams.

Cuque assesses that Dealers should pay attention to the fact that, besides the marketing compensation possibility, insurance can be worked as a valuable tool of loyalty, after-sales and even as a catalyst for new business. “There is the need of change of Dealers’ perspective because, well beyond the immediate profitability, the ‘I’ products bring client’s loyalty to the company, return in maintenance inspections and movement throughout sales chain of new and used vehicles,” he says. “For example, in the sale of an extended warranty, the clients must return more times to the dealership, bringing new business opportunities,” he adds. For the Commercial Chief Officer of Resource Automotive, Paulo Souza Lima, the new generation of distribution segment entrepreneurs, who are taking over the family business, is already promoting cultural changes at dealerships. According to the executive, these young people are coming with a larger cultural load and knowledge of international markets. Thus, they are aware of this need. “We realize that in the last two years the Chain mindset is changing. The major marketing of ‘I’ products proofs that there is already a cultural change,” he says. Mazza believes that, in order to unlock the potential of profitability in insurance, the ideal is to implement a department of structured F&I, providing ostensible training to employees and managerial support to all from all dealership departments to the segment, while maintaining incentive plans to team members. The physical structure to

Dealer Magazine

debate

establish the section is minimal, according to him. “The department needs a desk, a computer, a printer and some privacy for the client,” he said, adding, however, that it is necessary to retain a consultant exclusively dedicated to F&I. “If the Dealer does not make this sale, another player will. The dealer is the main selling agent, makes a great effort to win the client and, at the time to take advantage of this slice of the pie, another agent may end up doing it. If the Dealer does not make this sale, they will be out of the market. It is inevitable,” adds Lima, Resource Automotive. “Expect that the sales person performs the transaction of a car and follows up on the sale of financing and products is very difficult and inefficient. The sales person must be focused on selling the car and on the values represented by the dealership. Once the sale is successful, the F&I consultant can assist the client with the best financing option and products sale. Dealers who keep asking their sales people to perform the whole process have been less successful,” warns Mazza, remembering that the department cost is easily paid off with the profitability of financial products and insurance. “The increase in sales and the resulting revenue generate a net profit above the cost to structure and hire an F&I department.”

Dealer Magazine

Albeit Travis Mazza assesses as good the information quality that reaches the Dealers on F&I best practices, Mazza suggests that a consulting service can be a good alternative when the entrepreneur decides to structure the department, and cites, as an argument, the own lack of experience of the segment to market the products. “The domestic market has no history of successful experiences in the sale of car extended warranties, something that is not yet culturally disseminated, for instance,” he says. USA Example – JM&A Vice-President believes that in Brazil a movement similar to what happened in the United States in recent years is taking place: the drop in car sales margins and the reduced profitability in financial products. By the similarity of scenarios, he suggests that the North-American experience, which managed to restore profits with F&I products, can be replicated here. “We see a great potential in Brazilian dealerships to recover the margin on the sale of new and financed cars through the implementation and management of effective sales processes of F&I,” says Mazza. According to the executive, the flagship of the insurance industry in the United States is the extended warranty, closely followed by GAP (total loss insurance type), pre-paid maintenance and tire protection. Mazza states that in the United States the F&I department profits are composed of 40% to 50% of funding revenue (F) and 50% to 60% of profits generated by the insurance sales (I). “When we consider the number of new and used units sold in Brazil, the opportunities to achieve profits with F&I are substantial,” he says. For him, many products are still relatively new in the market and do not have funding possibility, a factor that – if changed – can leverage their penetrations. “If banks followed the same practice adopted in other countries and opened financing to all F&I products, the Country could see significant jumps in sales and rates of penetration and profit,” concludes Mazza.

Dealer Magazine

Santander

cover story

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the man of the act! Renato Ferrari, greater leader of Automotive Distribution industry, creator of Act 6729/79 that bears his name, was a businessman determined and passionate about the Law. He fought bravely for the industry interests, always with great serenity, dedication and determination. For over 45 years of incessant work, dedicated to the industry of distribution, guided by a single objective: the balance in the relationships among manufacturers and distributors of vehicles, resulting in the Act â&#x20AC;&#x153;Renato Ferrariâ&#x20AC;? that still regulates the relations of automotive distribution, involving manufacturers and dealerships. Deceased on May 3, 2013 at age 88, this true magician of the industry leaves family, friends and the certainty that it is worth fighting for ideals that benefit all.

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“I Above, Renato Ferrari with the then President of the Republic, João Figueiredo. Below, 25 years, Ferrari graduated lawyer from the Law School from the University of São Francisco (USP).

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t is a must to ally the intellectual wisdom to knowledge of reality, in all its hues and range of colors, in the vision of the experience ever more understanding of man and society that he is the beginning and end, checking, at one time, the action of their perfectibilities that lead to improvement and the attitude of their imperfections that sometimes degrade into primarisms and abuses of all kinds. Besides knowing for knowing, restricted to a purely contemplative level, one should materialize the known to act, within the constructive level of civilization, imposing them to find out and solve causes beyond ascertaining and mitigating effects, evolve and revolutionize structures unfit alongside the work of development of conjuncture, overcome obstacles imposed by adverse forces and overcome impotences and weaknesses.” With this thought, Renato Ferrari began his pronouncement to the President of the Republic, João Figueiredo, on November 18, 1979, during the solemn act of enactment of Act 6729 at the Presidential Palace. Always philosophical and determined in his activities, the great mentor of the Act named after him, guided his life in “know to take act”, as suggested in his words. Since his youth, Renato Ferrari was known for being a great idealist. “My father always wanted to contribute to the development of the Country; therefore, he was always very present in all subjects he got involved. I am proud that he has even participated of the history of Brazil,” boasts Rodrigo Ferrari, one of the patriarch’s five children. From humble origin, Renato Ferrari was considered a warrior and a fighter. “A man of hard work”, as Rodrigo describes him. In 1948, he graduated from USP law school located in the Largo de São Francisco, when the passion for the legal field enraptured him for good. “Law has always been his great work and development. His life was based on the Law,” says Rodrigo. A scholar, Renato Ferrari had a unique ability to oratory, as well as an exemplary facility for writing. “Before joining

the industry of vehicle distribution, my father was already a great lawyer”, adds the son. Rodrigo says that his father has always stood out everywhere where his father went. He says that when Renato Ferrari began a traineeship at an insurance company, still a student, in a short time, through his determination, intelligence and professional development, became head of the legal department of the company. “My father has always managed to achieve his professional goals. We are very proud of him and we mirror ourselves on his determination,” he says. The spirit of leadership and ‘associativism’ was also present in the personality of Renato Ferrari. After graduating lawyer, he opened a firm in São Paulo where he served large clients, including companies in the industry of distribution of liquefied petroleum gas. “At that time, with the help of several partners, founded Sindigás, institution presided for several years,” recalls Rodrigo. Visionary and with entrepreneurial profile, Renato Ferrari never planned small businesses in his career. In the late 1960s, he entered in the automotive segment by opening a Chrysler dealership in downtown São Paulo. “With this vision of idealizing large projects, soon moved the dealership from downtown to a large property he had purchased on Ibirapuera Avenue, South area of São Paulo,” said Rodrigo. From that moment on, Ferrari started to develop his associative participation in the vehicle distribution segment. At that time, when ABRAVE – Brazilian Association of Vehicle Distribution was created, he became the president of the

In the 1960s, Renato Ferrari attends the opening of ABRAVE headquarters in São Paulo.

organization. “With his arrival and associative spirit, my father and other leaders expanded the organization representativeness, even in the government, gaining body to be able to discuss with their peer organizations the issues related to the vehicle distribution in Brazil, which at that time was in its initial phase,” recalls Rodrigo. Always in favor of dialogue and balanced relationships, the distribution leader, with its serene, weighted and balanced profile, had the domain of situations. “He was the right person for this role. During the entire process, from Act ideation to its enactment in 1979, I do not remember my father having lost his professional balance or seen him angry,” says Rodrigo. Assobrav - Brazilian Association of Volkswagen Distributors, the first Make Association established in Brazil, gathered its leaderships, such as the organization President at that time, Pedro Capetto, the Vice President Sérgio Reze, among other leaders, such as Mário Megalli and Assis Pires, to discuss the idea of creating a standard that would regulate the relations among assemblers and their Chains. “The contract enslaves and the law frees,” recalls Sérgio Reze, current President of Assobrav and former Chairman of Fenabrave, commenting on the famous expression of Renato Ferrari to justify the creation of the Act. “This was a fight in which the entire industry was involved, but the great merit belongs to the great builder, who wrote its articles; no wonder the Act is named after him,” says Reze. According to Reze, the wording of Act 6.729 was an important piece of the entire history of the industry. Once drafted, it was necessary to

regulate the standard, negotiating with assemblers the creation of the called Conventions of Economic Category. “Every law is important, but if it is not regulated, is inapplicable. I was fortunate to be one of the participants in the creation of the Conventions that Renato conducted very well,” says Reze. Among some points introduced by the Act it is the definition of operational area for the exercise of the Dealer’s activities, who cannot operate beyond their limits; minimum distances among Dealership stores of the same Chain, established according to criteria of market potential; Make Conventions began to establish the minimum distances. The fight for the Law approval – An important passage in the history of the Act 6.729, which was a source of great frustration for its idealist, was when the first Project, already approved by the House of Representatives and the Senate, received several amendments in its scope through vetoes made by the then President Ernesto Geisel. At the time, Renato Ferrari was called to Brasília by the Minister Chief of Staff, the military Golbery do Couto e Silva. “Upon entering the Minister’s office, and before the people present there, he understood that, as a matter of investments national interest, the Bill should be adjusted to meet the industry interests also. And so it was done,” says Rodrigo. From that moment on, the Minister Golbery participated actively in the process of adjustment and completion of the Act, contributing to balanced changes according to the interest of all parties. “I record here that the noble Minister Golbery, present in the several phases of this long journey

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and understanding it according to his recognized intelligence and culture, has always been sensitive to the Act, especially as an expression common to all industry stakeholder segments,” described Renato Ferrari in his speech. Even with this setback in the process of approving the Act, Renato Ferrari did not disheartened, he drew the responsibility upon himself, discussed again with the sector the point that needed to be modified and, within a legal logic, managed to make that the changes did not reflect upon the essence of the project. After that the Bill of Law was approved again in two votings in the House of Representatives and Senate, and promulgated by President Figueiredo in 1979,” recalls Rodrigo who at the time was only 16. Work oriented to the economic category – For the creation of the Act 6.729, Renato Ferrari understood that the Vehicle Dealerships were part of a separate economic category, so it could not be simply considered as assemblers’ representatives. In a meeting with President João Figueiredo, with the Vice-President of the Republic, Admiral of the Fleet Rademaker Grunewald, and then Minister of Education, Senator Jarbas Passarinho, in 1975, Ferrari raised the issue that was the forerunner of the Act: the modern legal form of commercial concession in its own identity and independent from other contractual forms provided by the law. “In his doctrinal treatment, it becomes clear, along with his characteristics, the

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basic problem of this consistent contractual model in the remarkable difference of economic strength between grantor and dealership individually considered, whose relationship is inapplicable to the maximum of the individualistic philosophy of the nineteenth century of ‘Pacta Sunt Servanda’ [pacts must be respected, in Latin] to prevail the principle of contractual justice of the twentieth century, expressed in the legal balance between the parties,” as Renato Ferrari himself described in 1979 on the promulgation of the Act. Sérgio Reze said that the Renato Ferrari Act was a major milestone in the automotive distribution industry. “I was alongside Renato Ferrari from the beginning, when he pledged to create and implement for the distribution industry an act that would regulate the relations between assemblers and dealerships. Today, if we did not have the Act, we would be at the mercy of the manufacturers’ wills, contracts … Imagine how difficult it would be for everyone, in a universe of more than 7,000 Dealerships, to negotiate contracts with assemblers. It would be a tragedy,” says Reze. Once the law was elected to regulate the complex reality of the automotive activities, whose relations among producers and distributors used to be established by commercial concession of adhesion contracts, years of study and energy to its accomplishment were committed. “My father thought the articles of the Act already providing legal interpretation for each discussion. His ideals were ahead of his time,” says Rodrigo Ferrari, adding that

Ricardo, Renato and Rodrigo Ferrari. Together they administer the GM and Hyundai dealerships of the Group.

the Act created by his father served as inspiration for sectoral regulation of several Latin American countries and also for two North-American states that have regional laws. The Act 6729, current 8132/90, is a law that came dignify the national forums, according to the description of the own Renato Ferrari. “It was introduced in our legal system this figure obviously inexistent in our commercial code of 1850, this introduction assuming a pioneering character, asserting the principle of contractual balance, in the most advanced legal thinking,” complemented the industrial leader at the time. By means of this standard, Renato Ferrari accomplished his goal: to establish peer relationship among multinational companies, grantors vehicle producers and domestic companies, in this case the distributor dealerships, serving as a model for other countries. “This was a background development with extensive and benefic ramifications of a general nature. This Act enhances structures that revealed to be improper, eliminated obscurantist causes and freed up for new paths,” said Renato Ferrari. After four years of the enactment of the Act 6729, the first Convention of Economic Category of Producers and of Economic Category of Distributors of Motor Vehicles was held, another phase overcome by the distribution industry, the journey of regulation of trading relations between the industry and Chain.

“But, the path of evolution demands that we remain at the table of negotiations, from which we have the experience of the difficulties and disappointments, but also the certainty that it is the way to prevent misunderstanding that is always harmful, and in this path we must accelerate the speed of negotiations without losing sight of the consumer’s right.”

Considered as important as the Act, the first Convention consists of several provisions, which presented a new level in the joint and consensus discipline of production and distribution of motor vehicles, “without which there will not be peace, nor progress, or enhancement in this complex and difficult industry,” he said at the time and complemented: “But, the path of evolution demands that we remain at the table of negotiations, from which we have the experience of the difficulties and disappointments, but also the certainty that it is the way to prevent misunderstanding that is always harmful, and in this path we must accelerate the speed of negotiations without losing sight of the consumer’s right,” he said. According to Rodrigo Ferrari, this has always been the premise followed by his father in the drafting of the Act: in addition to ensuring the interests, rights and duties of both the Dealerships as the manufacturers, Renato Ferrari was attentive to the consumers’ rights, even many years before the creation of the Consumer Protection Code. Diversification of businesses – Renato Ferrari’s great passion was known by the legal area, so much so that even acting in multiple activities, he never ceased to be a great jurist, respected by colleagues and always consulted to assist in some clash or doubt of any case. “Albeit performing other activities, my father militated not as a lawyer in an office, but also through opinions, drawing up business or in Renato Ferrari and Sergio Reze: the union of leaders in favor of development of vehicles distribution industry.

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the making of contracts. He never abandoned the Law. Always involved and having relationship with people of the legal world,” said Rodrigo Ferrari. In addition to the passion for the work as a lawyer and the struggle in the vehicle distribution segment, Renato Ferrari also worked in real estate. His first major achievement in this industry was the building that housed the Chrysler dealership, on Ibirapuera Avenue in São Paulo. “Renato used to follow every detail of the project of a venture, frequently visited the works and throbbed with the process ongoing. It was an activity he loved. If he were not a lawyer, he would certainly be a good architect,” says Ms. Michelina Ferrari, stating that - always a visionary – Dr. Renato envisioned what would be the first real estate venture in Brazil to ally residential apartments with commercial units on the same site. The project was built in Moema neighborhood, South area of São Paulo city. In the private sector, worked for liquefied petroleum gas distribution companies and was a board member of relevant private entities, and was President of one of the companies in this industry. In the public career, he was President of Padre Anchieta Foundation (Cultura Radio and Television) and Secretary of Culture in the Administration of

Jânio Quadros, when participated of the full renovation of Municipal Theatre of São Paulo. “He was very much involved in that renovation. He would go every day to the Municipal Theater to monitor the progress of works. He was also member of the International Academy of Law and Economics, among others. We are very proud he participated in this landmark of the city,” says Ms. Michelina Ferrari. Despite this multiple range of activities, Renato Ferrari devoted much of his career to the vehicle distribution industry. He owned the Granleste dealership (SP), representative of GM make, established in São Paulo capital and others in the Southern coast of the state. He also had two Hyundai Brazil dealerships in the capital, nowadays run by three of his five children. Long Life to the Ferrari Act – In the 90s, the Ferrari Act was threatened by the Brazilian government, after the change of administration. The arrival of new makes, which increased the competitiveness by introducing vehicles with greater technological evolution and larger warranty term, sparked a revolution in the industry. At that time, the number of dealerships shrank to 4,500 from almost 6,000.

Renato Ferrari Phrases Renato Ferrari was well known among family, friends and people of his professional relationship, for characteristics phrases that have always been present in everyday life of this great leader and that today are remembered fondly by all those who knew him. “When I reach the end of my life, I will know I fought a good fight, I finished the race and kept the faith. Now the only thing left for me is to receive the crown of righteousness that the Lord Righteous Judge will give me.” “One of the main priorities of your life is to know your rights.” “Wisdom is in the balance.” “Learn with my white hair. If you don’t have an old person, buy one!” “I will stop working only after my seventh day mass, because I will still have things to resolve.” “All in good time. Patience is the mother of all virtues.”

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Family united: Ricardo, Rodrigo, Patrícia, Roberto, Renato, Ms. Michelina and Dr. Renato Ferrari. “For him, the fingers represented the five children, who, together, created the unit with the palm of the hand,” explains Ms. Michelina, illustrating with her hands. “Renato was a Godsend for us,” concludes.

The then President of the Republic, Fernando Collor de Melo, understood that the Act 6729 hurt the practice of free market at some points, that Fenabrave, chaired by Alencar Burti at that time, welcomed the government demand and worked on changing the Act that received the number 8132/90. “Minister Zélia Cardoso de Melo handed a note to a politician requesting the cancellation of the Act. I become aware of this request and, promptly, alongside Renato Ferrari and other industry leaders worked to reverse the situation and update the points of conflict with the government,” recalls Burti. “The most important change was in the fifth article that provides - for the consumer - the right to acquire the good, object of the concession, at the location that would best suit them. Therefore, it remained vetoed to the Dealership acting outside of its operational area, i.e., the client can buy at the Dealership of their choice, becoming subject only to the compensation of technical assistance services under warranty provided by their Chain colleague situated in the purchaser region, as stipulated in the Make Convention,” adds Burti. Even with the market change, the growing number of dealerships, the large variety of models and strengthening of large groups of concession, the Ferrari Act is still current and active. “Internet sales and mobility of the consuming public in the Country can cause erroneous interpretations of some points of the Act; however, Fenabrave believes it is appropriate for all distribution operations,” explains Paulo Engler, Fenabrave Chief Officer. In Engler’s opinion, the Act suits the market. “What is missing is information. Dealerships must

pass the Act premises to all their staff know the standards of the industry,” he says. “The Renato Ferrari Act is the most important of our industry, sophisticated, and brings legal safety for the vehicle distribution. Renato Ferrari was very wise in the preparation of this standard,” says the current Chairman of Fenabrave, Flavio Meneghetti. Recently, Fenabrave, by means of a group formed by the Chairman of Fenabrave, Flavio Meneghetti, by the President of Assobrav and former Chairman of Fenabrave, Sergio Reze, the Vice President of the organization, Melchior Luiz Duarte de Abreu, and the former Governor of São Paulo and Fenabrave Consultant, Luiz Antônio Fleury Filho, held an audience with Senator Ana Amélia, at the Senate of the Republic. The meeting aimed to discuss the Draft Law No. 402/2012, authored by the Senator who proposed several changes and imposed significant risks to the continuity of the Renato Ferrari Act. “Fenabrave advocated, during the hearing, the preservation of the Act that regulates the system of distribution of vehicles in the country. With strong and logical arguments, there was understanding on the part of Senator, the Draft Bill was archived and the Ferrari Act continues in force,” celebrates Meneghetti. “Renato Ferrari devoted a lifetime, was exposed to and abdicated many things in favor of the collective interest of distributors. Examples like him encourage and motivate distributors to work together. Individual interests must not take precedence over the collective one. This is the lesson left by him and will always be an example for future generations,” concludes Meneghetti.

Alencar Burti, former Chairman of Fenabrave, and Flavio Meneghetti, current Chairman.

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F&I

Extended Warranty = Client’s Satisfaction + Profit

is it?

Page 40 - Marcela Verdi Zago, Vice-President of Usebens Seguradora, Marcos Moreira, Officer of F&I Brasil, and Luciano Groch, Officer of Assurant Solutions. Management

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About to receive a new regulation, the extended warranty can be an excellent source of revenue in F&I, but has generated unsteadiness among expectations of clients and entrepreneurs.

ust a quick search in the Internet is enough to see that extended warranty is an issue that is far from being unanimous among consumers. Problems with the definition of covered items, terms and doubts about how to proceed in case of claims are common, so much so that recently the Superintendency of Private Insurance (Susep) and the Federal Consumer Department (Senacom) announced studies for improvement – and possibly new regulations – of the product. Despite this dissatisfaction happen on a larger scale in the electronics segment, this scenario leaves a question on the agenda of Vehicle Dealers: how to please consumers and, at the same time, profit from the extended warranty? According to Marcos Moreira, Officer of F&I Brasil, the extended warranty, which is one of the insurance main products in the U.S. automotive sector, has a large return potential, both for Dealers and for consumers, but still suffers from the fact that it is a novelty in the market. “The new F&I products, including the extended warranty, are new for sales professionals and consumers. Its culture is being formed. Consumers’ satisfaction will gradually increase to the extent that they have more contact with the product and reap its benefits,” he says. The executive reiterates that such insurance is something that should receive special attention from vehicle distribution entrepreneurs because of the supply capacity – which reaches all who do the business – and the actual amount paid by the sale of policies. “The extended warranty has the advantage of being offered to 100% of the buyers; dealerships can achieve sales of approximately 30% to 35% and ensure a commission of about BRL 400 to BRL 500 per policy sold,” says Moreira.

Another advantage highlighted by the Officer of F&I Brasil is that, in addition to the own compensation, this type of insurance can contribute to greater revenues in the after-sales department and ensure clients’ loyalty in profitable segments of the business, such as services and parts departments. “The extended warranty impacts significantly on after-sales activity, encouraging regular maintenance inspections of the vehicle at the dealership, with adequate remuneration of parts and labor,” assesses Moreira. Dedicated Department – To make the most of this type of insurance, however, we recommend that Dealers invest in the F&I department and promote the correct passage of the client through the area, setting up a dedicated department to handle financial products and insurance, with well-trained people on the subject. “It must be someone prepared to explain the services in detail,” suggests Luciano Groch, Officer of Assurant Solutions, who advocates a model in which the consumer receives the most information as possible about the product. Thus, in addition to increasing the penetration of extended warranty, the Dealer can provide a better shopping experience for the consumer. This is because, through the F&I department, the buyers will have at their disposal, at the time of contracting, a presentation on the product with details on coverages, exclusions and procedures in case of accident. “And more, they can clear any doubts that may arise regarding their insurance. The site is fully dedicated to the correct instruction of the insured, not being confused, for example, with the actual purchase of the vehicle in question,” exemplifies Marcela Verdi Zago, Vice-President of Usebens Seguradora.

According to Groch, about 50% of Brazilian dealerships already have a specific F&I department in operation, and most of them are already working with good penetration rates, even managing to retain consumers. “When clients buy repeatedly is a sign of maturity of the product,” assesses the Officer of Assurant Solutions. Regulation – Another point raised by the experts is the study group organized by Susep in partnership with Senacom. Entities do not disclose which actions will be taken, but it is speculated that a regulation that involves the professionals’ certification is to come. “The expectation is that Susep does something similar to what Central Bank did regarding the credit operations originated at dealerships, creating a figure similar to the correspondent,” says Moreira, citing Resolution 3954/11, which provides that, from February 2014, only certified professionals will be able to submit and progress credit applications.

Marcela believes that, if it in fact occurs, will not cause major impacts on dealerships daily operations, since most of them already work with appropriate structure and professionals. “Most dealerships that commercialize extended warranty insurances (among other insurance products) already have trained professionals who are able to explain and clarify the insurance rules to all clients,” she says. Useben Seguradora Vice-President also assesses that this movement tends to be beneficial to the entire market. “First of all, because it ensures the correct instruction to the insured as to the product they are purchasing. A well instructed consumer contracts more insurance products, as they begin to see the real benefits provided by them (which are not few). Moreover, the number of complaints relating to claims, regarding the insured misinformation, should decrease considerably to the extent that the contracting party knows exactly which rights they can claim.”

PRODUCTION LINE

Success (greater than) expected Hyundai HB20 is already the fourth best-selling model in Brazil until May. The assembler, which should soon start the third shift at the plant in Piracicaba, says it is close to the limit of productive capacity and states that the goal is to become the number one company in customer’s satisfaction.

ecently, Hyundai Motor Brasil (HMB) announced the start of the third shift at the plant in Piracicaba where, since November last year, it runs the production line of the Korean-origin assembler. The company does not disclose the total number of increase in productive capacity (maintains the unit launching estimates, which were about 150,000 vehicles per year), but one thing is certain: the HB20 family will continue invading the streets of Brazil. Just to get an idea of the assembler good moment, according to Fenabrave (National Federation of Automotive Vehicles Distribution) data, between January and May this year, 53,430 HB20 hatchback vehicles were plate licensed in the Country. This puts it as the fourth most sold vehicle in the domestic market, behind only of the leader Volkswagen Gold and of Fiat models: Uno and Fiat Palio.

These numbers become even more impressive when one notes that Hyundai is already ahead of Renault in sales of new cars and light commercials in the year and that, if we excluded from the calculation the numbers of direct sales and counted only retail data, the Korean hatchback would take Uno third position and would be less than 3,000 units of the second placed Palio. “Success has been even greater than we expected,” says Cassio Pagliarini, Hyundai Marketing Officer, which recognizes that the good impression left in the past 10 years, for imported vehicles and upper segments as Azera, Tucson and i30, has contributed for the good moment of the company. “Undoubtedly, we went on profiting from the image that sophisticated models left us,” assesses, noting, however, that the very HB20 is offered with a

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PRODUCTION LINE

150,000 cars can be produced per year 5,000 direct jobs generated HMB in figures 20,000 indirect jobs 4 are the main activities carried out in the plant: stamping, body, painting and general assembly of vehicles

USD 700 MM was the total investment in the unit.

package of comfort items superior to competition. An interesting detail is that the Brazilian plant of Hyundai, which received investments of USD 700 MM, was designed to produce a model that, somehow, goes against the strategy of global cars so in vogue right now, being developed with focus in the domestic market. To Pagliarini, it happened due to the level of demand of the local market. “Brazilians are very critical of designs, of panel and comfort items,” explains the Executive. However, Pagliarini points out that several car components are shared with other vehicles, in particular parts of engine and gearbox, which also equip models like Veloster and i30, but states that the very vertical production structure of Hyundai facilitates the development of vehicles according to the assembler needs. “Hyundai has a steel mill, for example. So we have possibilities of development that other assemblers do not have,” he says. Demand – The success, however, also has its mishaps. One of them was to meet the demand that the HB20 family presented since its introduction in the Country. Pagliarini tells, for example, that the company had to postpone, in about one month, the HB20 launch, the family sedan model, to stabilize the hatchback delivery in Brazilian stores. 44

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Another issue addressed by the Executive is the great volume of orders for white color vehicles that, according to him, respond, on average, for 15%20% of the production of models in the Country. In the case of HB20, this rate reaches 40%. “Car with attractive design looks good in that color,” he explains. Pagliarini reveals that the plant with 69,000 square meters of built area already operates close to its annual limit of production and discards, initially, the possibility of beating Ford, currently the fourth largest assembler in the Country, which, according to Fenabrave, holds 8.96% of domestic market - Hyundai has mastered 5.95% of this pie. “We do not have production capacity for that,” he assesses. “Our goal is to be the number one company in customer’s satisfaction,” he emphasizes. Appointments – Operating close to the limit, Hyundai does not reveal whether plans to build another plant in Brazil, as the specialized press has propagated. Thus, the number of Hyundai Motor Brasil dealerships should not continue to rise at the same pace in the coming months. According to its Officer, about 150 HMB dealerships in the Country are sufficient to distribute the production of 150,000 vehicles per year.

management

What is the cost of selling a new car? 46

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According to calculations made by Tempo Group, the average cost, for the dealership, of a new vehicle is 6.63% on the total sales value. Lean staff and smart buying help maintain profitability.

he Tempo Group, which has dealerships distributed in the cities of the State of São Paulo such as Campinas, Americana, Hortolândia, Indaiatuba, Santa Bárbara d’Oeste, Sumaré, and Valinhos, conducted a thorough study of what is the cost to sell a new car and has reached a result that may surprise those who do not keep a tight control over their operations. According to Mauricio Queiroz, Officer of the company, the average value assessed is about 6.63% of the sale value of the vehicle. “Costs are linked to two factors: dealership size and operation region,” summarizes the Executive. Queiroz explains that in the calculation made by Tempo Group, which represents the makes Fiat, Ford and Volkswagen, the entire chain of costs and expenses is accounted – both fixed and variable – such as personnel, operational expenses, communication, and taxes, among others. These costs are parameterized by department and accompanied by a series of indicators, such as percentage of gross revenue, amount of expenses on sold volume and representation of expenses on the operation contribution margin. Through this process, the company reached an average operating cost of 4.63% on gross revenue, added to 1.6% of apportionment of corporate spending, which covers areas such as information technology, human resources and general administration, plus 0.4% of apportionment of disbursement with the holding, which includes controllership expenses, accounts payable and receivable, tax and legal area. The final result is an average cost of 6.63% on the total sales value of each new vehicle sold. This value, of course, is only achieved due to the excellence in control and management of company operations. To reach that number, Queiroz states that Tempo Group works constantly on optimizing their processes and reveals great care with the company inventory management. “In our business it is preponderant to maintain the inventory adjusted,” explains the Executive, who says that the company profitability pillars are inventory quality, assertive communication actions, lean and prepared staff and strict cost management.

Among the measures to work the correct amount of vehicles in the yard, he cites the importance of buying - correctly - the model and the quantity of vehicles. “Therefore, the ideal is to invest time and resources in the placement of orders (collecting programs). It is also essential to develop tools to monitor sales behavior taking into account the product specifications, such as motorization, optional and color, and follow up the orders and take effective action in the variables required for adjustments.” According to Queiroz, the ideal is to maintain an inventory to ballast operations for a period of 21-27 days. Furthermore, it is important to be aware of market opportunities, such as specific strategies for specific or seasonal products. “In addition, equally important is the department management, which includes daily monitoring of inventory, with efficient strategies in the development of actions to drain any bottlenecks,” he adds. Indicators – The Officer emphasizes the importance of monitoring the efficiency indicators through software specific to this end. According to him, the Tempo Group adopts the matrix method of management. Furthermore, he explains that the company organizes monthly meetings focused on contribution margin and gross profit with the managers of each department, in which they discuss and disseminate actions and results, and performs benchmarking with the Dealer Chain, besides participating of Make Associations. Queiroz believes that the tight control of the entire operation of the company is the most efficient way to achieve profitability in the current scenario of the automotive distribution. “It is essential to our survival and business prosperity, be profitable and, therefore, the vehicles purchase and sales margins must be recovered,” he concludes.

Maurício Queiroz, Officer of Tempo Group.

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SUSTAINABILITY

Green in the Chain Operate sustainably is already a necessity for Brazilian companies. Thinking about it, Fenabrave held, on May 15, the Training course for Environmental Agents, in which Dealers could learn a bit more about the performance of environment managers.

Leopoldo Charmelo, Full Professor of Environment and Sustainability at University Center of Caratinga, and Luiz Henrique Lopes Vilas, Officer of Ouro Verde Meio Ambiente e Negócios Sustentáveis, teaching course at Fenabrave headquarters in São Paulo.

he concern with the environmental degradation, the importance of keeping green projects and complying with standards governing the damage to nature are already a reality for Brazilian companies. And, to assist automotive distribution companies to optimize their management in sustainability, Fenabrave (National Federation of Automotive Vehicles Distribution) held, on May 15, at its headquarters, the Environmental Agents Training Course, taught by Leopoldo Charmelo, Full Professor of Environment and Sustainability at Caratinga University Center, and Luiz Henrique Lopes Vilas, Officer of Ouro Verde Meio Ambiente e Negócios Sustentáveis.

The course, which lasted eight hours and received more than 85 Dealers from all over the Country, addressed the importance of the presence of internal environmental managers and auditors at vehicle dealerships and clarified the attendees about what is the role of these professionals. “The manager must provide resources to comply with the law and avoid the generation of environmental liabilities, approve the qualification and training of their staff, publicize the program to all employees, propose action plans necessary to reduce the generation of environmental liabilities and monitor and commit to the development of the project at all levels,” explained Charmelo. The Professor said he understood that the implementation of a department to manage the

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SUSTAINABILITY

The people present in the auditorium of Fenabrave could know more details of the work done at DVA Veículos and at JSL Concessionária, presented by Sérgio Ricardo R. de Oliveira and Bruna Cremon, respectively.

Law: Dealers must re-register in the CTF from July An important point addressed in the Environmental Agents Training course is the attention that Dealers should have regarding the obligatoriness of re-registration in the CTF (Federal Technical Registry) of potentially polluting activities from July 1st. The requirement is part of IBAMA Normative Instruction No. 6, from March 15, 2013. CTF is one of the tools of the National Policy on Environment (Federal Act 6938/81) and requires that individuals or corporations that engage in potentially polluting activities or extraction, production, transport and marketing of products potentially hazardous to the environment register in the body. Therefore and also complying with Normative Instruction IN 31/2009, every legal entity that performs lubricating oil exchange, regardless the size and the amount of residues generated must necessarily have a register in the CTF. Those who have not registered or did not re-register from July 1st will be subject to the payment of fines.

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company sustainability projects has a cost to Dealers, but noted that the compliance with the environmental standards can prevent companies from paying fines or being punished by supervisory bodies, and can reverse the institution image in gains. “Start slowly with the environmental implementation, but be sure to do something. There is no need to buy an oil-separating box very expensive. At the beginning, use one of a low value, but have initiative. Having the environmental permit is required for Dealers, and that is why I reinforce the obligatoriness of CTF (see box) to individuals and corporations that carry out activities with pollution potential, i.e., every dealership must be registered,” he said. Vilas reinforced the efficiency of small actions in daily operations and warned that many companies do not comply with the environmental law strictly. “Not all dealerships educate their mechanic on residues separation, for example. It is important that companies encourage their employees and implement awareness courses, seeking, for example, to show videos on environmental actions,” explained the Officer of Ouro Verde.

Those who make the difference – Knowing that the care with the environment goes beyond a set of laws to be respected, but can also contribute to an improved life quality and the natural resources preservation for future generations, some Brazilian dealerships already have environmental managers in their staff employees. One example is DVA Veículos (Mercedes-Benz), in São José (SC), a company that has won the assembler award for reduced environmental liability. “Once a year, we are visited by a Mercedez-Benz auditor and we won a gold certification due to the reduced environmental liabilities and staff awareness,” said Sérgio Oliveira, safety technician and environmental manager of the company, noting that the action is part of Star Class, a quality national certification program from the manufacturer. To achieve that result, besides the awareness programs, the company maintains several actions to preserve the environment. “We reuse

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rainwater for washing vehicles and give the proper destination to oil and hazardous residues, in addition to recycling paper, glass, plastic and metals,” he said. Another company that already works with a focus on best practices of sustainability is the JSL (Fiat, Ford and Volkswagen), in São Paulo. According to the environment Analyst Bruna Cremon, the company invests in an awareness project that goes beyond the workplace. “We seek to make clear the company concern with the environment and the future of the planet, therefore, there is no use recycling in the workplace only, it is necessary to worry with the issue also at home,” said the Analyst. As part of its booth at ExpoFenabrave (August 7-9, at Expo Center Norte, in SP), Fenabrave will have a room dedicated to sustainability, with the presence of consultants to talk with Dealers interested in implementing sustainable processes in their companies.

01/07/2013 10:00:02

success story

Investment in people

With training programs, open and intensive communication, and valuing people, Saga Group is the only company in the automotive distribution sector on the list of best companies to work for of the Great Place to Work.

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Integration events and technical training to employees of Saga Group, one of the best companies to work.

recent survey conducted by ManpowerGroup, multinational company specialized in human resources, pointed out that 68% of Brazilian entrepreneurs face difficulties to fill in open positions in their companies. The result is just the evidence of a phenomenon that is worrying entrepreneurs in several sectors: the world is experiencing a growing shortage of talents. The problem, however, can be tackled with investments in the attraction and retention of professionals and creating an environment of satisfaction to the employees. That is what Saga Group has been doing, the only representative of the automotive distribution industry on the 2012 list of the 100 best companies to work for of the Great Place to Work.

“Saga builds its strategy through people. This differential is the way to build and strengthen bonds among employees, company and clients, which consolidates our values. Therefore, we believe and invest in the human resources area because only through people we will achieve our goals,” states the Officer of People and Management of the company, Lilian Castro, who tells that the group, founded 40 years ago, has 3,051 employees in 36 dealerships located in various regions of Brazil. Lilian explains that one of the main satisfaction generators among team members is the fact that the company is constantly encouraging their employees’ participation in decision making and giving them the freedom to present solutions to the challenges faced by the group. “In our work Dealer Magazine

success story

Employees are encouraged to participate in social activities. Training programs, conducted by Unisaga, assist in the development of employees for better services rendering and customer services.

environment, everyone is encouraged to have autonomy and passion for what they do. We encourage personal and professional growth. We invest in development and we recognize and celebrate the achievements of our employees. In addition, practices that promote excellence are widely disseminated and enhanced,” she says. The Officer also emphasizes the importance of an open and intensive communication at all levels of the company business units. “We consider the information and dissemination of our strategies as essential factors for the commitment of all. The care with communication, easy access to media and clarity of messages ensure alignment and deployment of all information, making all strategies known to all employees.” Attraction and development – Besides the good communication and the stimulating work environment, Lilian says that to attract and retain talents from various areas the company offers life quality programs, attractive benefits, aggressive compensation, career opportunities and a skills training and development extensive program, with emphasis on Unisaga (Saga Corporative University), which is not a formal university degree program, but rather a set of extension courses of short and medium term.

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The project was born in 2005 as a dealership management-training program, in which about 30 employees participated of an eight-month course studying subjects such as accounting, people management and retail management. In 2010, Unisaga has undergone a makeover and adopted a model that could reach as many people as possible, with subjects targeting their work areas. Today the flagship is the area of training and development of the group. “Unisaga has the objective of support and consolidate the various learning phases within the organization,” assesses Lilian. Now, after the reformulation, Unisaga has a quite customized model of operation. First, area leaders conduct a study on which trainings will be needed throughout the year. Then, based on the organizational climate survey, we assess the needs identified by employees. Based on these two surveys, the people and the management department makes proposals that are forwarded to the board for validation. In this new model, the list of subjects of Unisaga is formulated annually and, thanks to the efficient communication process among all company areas, remains always updated. Strategic HR – The human resources area has a strategic role in the Saga Group business, since that through training and development, employees

absorb effectively, the company culture and operation mode. As an example, Lilian says that the industry has great importance in the managing model of the company that adopts the internal consulting system to assist business units, enabling closer proximity, agility and alignment and partnership among different areas. “We emphasize this performance model in all people and managing area byproducts and in supporting activities,” she says. According to the executive, the system implementation was born of necessity to develop strategies to leverage results through the management of people, processes and decentralized routines, and focused on developing and adopting monitoring tools and productivity and efficiency analysis. “This model allows a business strategies-based performance that drive and ensures the organization results,” adds the Officer.

Company results, by the way, are incontestable: in addition to being in the 2012 list of the 100 largest companies to work for of the Great Place to Work, Saga Group was, for three consecutive years (2008, 2009, and 2010), on the survey list of the 150 best companies to work for of Editora Abril, and has been for the last 10 years the Volkswagen dealership most remembered by consumers in the State of Goiás, according to the O Popular newspaper. Moreover, it is certified by Toyota as one of the 30 largest dealerships in Brazil through the Dealer Evaluation program.

Entity assisted by Saga Group receives and celebrates donations delivery by employees.

DESEJAMOS RIMAR COM SUA EMPRESA

Peças Injetadas (Die Casting) Ética, tecnologia, pessoal, segurança, meio ambiente, qualidade, produtividade, rentabilidade, reinvestimento e geração de novos empregos são os mandamentos da Rima. Uma empresa 100% brasileira e líder de mercado.

www.rima.com.br | comercial@rima.com.br | (31) 3329 4206 Anel Rodoviário KM 4,5 | Belo Horizonte/MG Untitled-1 1

02/07/2013 19:27:42

launches

Light commercial vehicles highlights Two novelties in the segment of light commercials should shake the market: the first is the new generation of Toyota RAV4, which comes with engines 2.0 and 2.5, prepared to fight directly with SUVs Honda CR-V, Hyundai IX-35 and Kia Sportage. The first Volkswagen medium pickup, Amarok, was also presented in a new version with larger engine power (gained 18 hp, which increased its power to 140 hp), which will be offered in single cabin configuration (with 4x2 or 4x4) or double (4x4). In addition to these novelties, the new line of Agrale tractors and the new DAFRA custom - the Horizon 250 - were presented. Check it out!

toyota Toyota launched in the Brazilian market, the New RAV4, urban sports utility that lands in the country, in its fourth generation, and represents the beginning of a new era for the make in this segment. The new RAV4 is available in three versions: the entrance with 2.0 l engine, Dual VVTi, with 4x2 (BRL 96,900); the intermediary with 2.0 engine, Dual VVTi, with 4x4 (BRL 109,900); and the top of the line, with 2.5 engine, Dual VVTi, with 4x4 (BRL 119,900). In addition to the premiere of the new engines, the model comes mated to a CVT type

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transmission, and the 2.5 4x4 version offers a six-speed automatic gear. The new model has standard features such as air conditioning, hydraulic steering, CD player with Bluetooth connection, USB and auxiliary; steering wheel with radio controls, dual airbag, fog lights, parking sensor and e ABS with electronic distribution of braking force (EBD) and system of emergency braking assistance (BAS). Among the competitors, the Japanese model will dispute market with rivals Honda CR-V,Â Hyundai iX35 and Kia Sportage.

volkswagen Volkswagen Amarok entrance options now count on more horsepower. The 2.0 TDI four-cylinder engine with a turbocharger, which equips the S version of the pickup â&#x20AC;&#x201C; offered in single cabin configuration (with 4x2 or 4x4) or double (with 4x4) â&#x20AC;&#x201C; gained 18 hp, which increased its power to 140 hp. Amarok is offered in seven configuration options, including single and double cabin bodies, six-speed manual or eight-speed automatic transmission. The 2.0 biturbo diesel engine that equips the SE, Trendline and Highline versions remains with 180 hp.

Amarok sales are continuously growing in the Brazilian market. The first Volkswagen medium pickup, which began to be marketed in Brazil in May 2010 and, in 2012, had the best year of sales of its history. The utility recorded 19,825 units sold in the domestic market, which represents a 93.8% growth against 2011 sales. From January to May 2013, Amarok accumulated 9,819 units sold in the Country, 76% greater volume than the same period in 2012, when 5,568 units of pickup were sold. Only in May 2013, 1,933 units of Amarok were sold, a 74% increase against May 2012 (1,106 units).

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launches

agrale Agrale participated in the 5th Serra GaĂşcha Horticulture (mountain region of the State of Rio Grande do Sul), on May 22-25, at the Center of Events of the Grape Festival Park, in Caxias do Sul/RS, and introduced its new 500 Line of tractors, besides the traditional models of 4000, 5000 and 6000 families of the make. Newly released, the 575.4 Compact tractor received the Golden Trophy at the Family Farming Division of Gerdau Award of the Best of Earth 2013, highest distinction in South America for the segment of agricultural machinery and equipment.

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The Agrale 575.4 Compact tractor has as main features, robustness and low operating cost, as well as advanced technology. The model is able to achieve extremely reduced speed, reaching up 0.24 km/h, much lower than that achieved by other compact tractors in the market. This allows the work in perennial crops that require a slower operation. The tractor also has reverser, lever that enables agility in reverse direction of the machine, making operations and maneuvering easier in small areas.Â

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Jeep The luxurious Grand Cherokee CRD (acronym for Common Rail Diesel, alluding to the electronic injection of single duct) was officially introduced by Jeep in March. The turbo diesel model is available only in highend configuration Limited and its suggested price is R$ 219.9 thousand. In the market, the model competes with diesel versions of Mitsubishi Pajero Full and Land

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Rover Discovery 4. Multijet II technology of the new V6 propellant 3.02 yields 241 horsepower. According to Chrysler, the performance figures are on average 10% higher than the previous generation. Built by the Italian VM Motori, the engine uses and pollutes less. The plant figures indicate an urban consumption of 9.7 km/l and 13.9 km/l on the highway.

dafra Early June, DAFRA introduced the new member of the family: the Horizon 250 model, a custom style motorcycle that expands the Brazilian make offer in this cylinder capacity range, which also counts with the street Next 250 and the sports Roadwin 250R. The model main competitor is the Kasinski Mirage 250 motorcycle. “Today, our 250 line offers one product for every style of rider. However, they all have important features in common, such as excellent ergonomics, especially for those who use the motorcycle daily, more modern design and different from what there is in the market and, especially, a complete

package of equipment,” says Mauro Ferraz, National Sales Manager of DAFRA Motos. The new Horizon 250 brings a four-stroke 250.2 cm3 engine, DOHC (Double Overhead Camshaft), four-valve, electronic injection system and liquid cooling. It achieves power of 23.11 hp to 8,000 rpm and maximum torque of 21.7 N.m to 7,000 rpm. “We seek a different configuration for the Horizon engine, with new command, cooling system and more cubic inches, all to guarantee higher torque,” explains Victor Trisotto, DAFRA Engineering Officer.

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Legal support

What is the tax war?

Paulo Carvalho Engler Pinto Júnior

In recent months, we have been watching at the Senate of the Republic the discussion on ICMS unification and the end of tax war. It is one more chapter in the attempt of tax reform, which unfortunately does not thrive. Anyway, what is the tax war?

n terms of economic and social aspects, the differences among the several regions of Brazil are flagrant. We have areas that are prosperous and supplied with all goods and services indispensable for growth. In contrast, there are others very close to absolute misery, causing huge social distortions. Unfortunately, the Brazilian nation has not yet found a formula that allows the development of production means and the access to education. Under the guise of promoting industrialization, several States and the Federal District have come to grant tax incentives for entrepreneurs install themselves in their territories, creating the possibility of generating jobs and distributing wealth among local people. Despite the noble cause and the good intentions of Public Administrators, this situation has created several distortions, especially regarding the tax collection, as the oversupply of the socalled “tax benefits” caused the fall in tax collection in the most industrialized regions and, consequently, increased unemployment and, yet has not represented an increase of wealth in poor areas, which decharacterizes the primary function of taking to every corner of the country the industrial development and the technical training improvement of its people. Tax costs in Brazil are extremely high, both for corporations and for individuals; we live under one of the highest tax burdens of the planet combined with a set of instrumental obligations that require a lot of time and effort from the taxpayer to comply with the relating formalities. The search for saving in the taxes

payable made companies - as an operating alternative to transfer part of their industrial park to several regions of the Country, usually where there were attractive tax benefits. The called “tax war” is the granting of fiscal incentives by States regarding the VAT (ICMS), automobile taxes (IPVA), tax on donatio mortis causa (ITCMD), allied to the financing or infrastructure for facilitating the installation of industrial parks. The term “war” is used because the fight among the States to attract industries is not restricted to new investments, but it also refers to causing the moving out of already installed companies from one State to another. Over the past 20 years, the movement of industrial plants in search of incentives was intense. For example: let’s imagine that a vehicle manufacturer, installed in a certain State has a tax incentive for financing the VAT outstanding balance in 120 months, with a grace period of 60 months. In the interstate sale, from Manufacturer to Authorized Dealer, two phenomena take place: (i) the Authorized Dealer pay the invoice in full; and, (ii) the State of destination allows full credit of VAT to calculate the replacing tax. Thus, the “VAT own operation” value remains in the manufacturer’s cash (who will pay to the origin treasury many years after, only), and the “VAT replacing tax” for the State of destination is negatively affected (because no payment was made at the origin). The end consumer pays for it all. The tax war must end immediately.

Paulo Carvalho Engler Pinto Júnior is a lawyer, Master in Tax Law from PUC-SP, Substitute Judge of the Court of Taxes and Duties of the State of São Paulo, and Chief Officer of Fenabrave.

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