Motorola Brazil Plans $200 Mln Investment, Opens New Factory
Bloomberg News
November 17, 1998, 3:17 p.m. ET
Motorola Brazil Plans $200 Mln Investment, Opens New Factory
Sao Paulo, Nov. 17 (Bloomberg) -- Motorola Inc., the world's
largest cellular-telephone maker, said it will invest $200
million in Brazil the next four years to meet demand in the
country's growing telecommunications business.
The investments would add to $150 million spent since 1995
developing four factories at its Jaguariuna complex in Sao Paulo
state.
Motorola is riding a wave of growth in Brazil's
telecommunications sector, prompted by the $19 billion sale in
July of Telecomunicacoes Brasileiras SA, the former holding
company for the country's entire phone system. That contrasts
with looming recession throughout the economy.
''There's no recession in the telecommunications industry
and there are no signs of it,'' said Dante Iacovone, director of
Motorola Brazil. ''We expect sales to increase by between 50 and
60 percent next year.''
In August, Motorola signed a $220 million contractto provide
cell-phone infrastructure for Global Telecommunications Solutions
Inc., which operates the new mobile-phone licenses in the
southern Brazilian states of Parana and Santa Catarina.
Motorola's new investments will go on research, development
and possible expansion at Jaguariuna, which manufactures a range
of products including cell-phones, pagers, semi-conductors,
radios and cellular base stations.
Investments
The company's latest investment is in a $20 million plant
producing iDEN (Integrated Digital Enhanced Network) mobile
communication systems which combine cell-phone, 2-way radio and
pager functions.
The factory, the first producing the systems outside the
United States, will begin production in January 1999. Maximum
capacity will be a million units a year.
The devices will be marketed by Nextel International Inc. of
the United States, whose Brazilian unit has already sold about
60,000 of the new Motorola systems in Brazil, imported from the
United States. Virginia-based Nextel has been selling Motorola
products in the United States since 1994.
''We have already ordered 10,000 (of the systems) from the
new factory,'' said Rodolpho Cardenuto, Nextel's marketing vice-
president in Brazil. ''And we expect to ask for more.''
Motorola is expanding local production at a time of growing
competition to supply technology to the market, not only in
Brazil, but also in Argentina, Paraguay and Uruguay, the other
members of the Mercosur regional trade bloc.
In January this year, the company completed another $20
million plant at Jaguariuna, aiming to produce 650,000 pagers in
1998.
Illinois-based Motorola's revenue was $29.8 billion in 1997,
2.1 billion or 7 percent of which came from its Latin American
operations.
--Justin Carrigan in the Sao Paulo newsroom at (5511) 3048- |
