SKF Brazil Expands Bearing Production and Exports

Production at SKF do Brasil (Brazil, a division of SKF AB, Sweden) has been expanded yet again, to both meet continuing strong domestic demand and move more aggressively into nearby export markets. Although SKF, the world's largest bearing manufacturer, operates a large number of manufacturing facilities worldwide -- approximately 80 -- most are oriented toward servicing local markets. Relatively few meet -- approximately 15 -- meet the company's internal standards and qualify to sell their output globally through the SKF distribution network. In an extensive four-year program, SKF has invested more than USD $10 million in manufacturing and quality initiatives at the Camajar plant outside Sao Paulo. It is now a world-class facility with both quality and production capacity sufficient to sell its output globally. Until now, production at Camajar has primarily targeted only its traditional Brazilian and Mercosur markets. Camajar joins facilities in Europe, India, China, India and the U.S. as a global supplier, and is the only plant in South America certified that way. Currently, SKF do Brasil supplies the domestic Brazilian auto industry -- Fiat, Ford, General Motors and Volkswagen -- along with some aftermarket and replacement bearings. Annual sales have been hovering around $100 million, and employment stands at almost 550 people. In 2004, Camajar will begin targeting new OEM customers in the U.S., China and Mexico, based on the products it now manufactures for automakers in Brazil. SKF do Brasil has been given a corporate sales target to raise exports to 30% of sales during 2004, up from only 10% of sales in 2003. By the end of 2005, Brazil's target is to be exporting fully half of the bearings manufactured there. The plant currently runs five lines, defined as taking a raw forging through to a finished and packaged bearing. Running at approximately 80% capacity, those five lines are expected to be out of capacity in 2004, so another line is being built. SKF said it does not yet know how many new employees will be added in 2004, but at least 100 more should be needed. Although it is relatively small -- SKF Brazil represents approximately 3% of the company's worldwide sales -- it has been growing in stature within the company for its operations, growth, and ability to secure strategic joint ventures. Highlighting its presence, in September 2003, SKF do Brasil's President, Alrek Danielson, moved to Sweden to succeed Christer Gyberg as President of SKF Industrial Division. SKF Brazil recently won Fiat's Five Star award for being its best automotive supplier in Brazil for the past five years running. In 2002, it won a coveted contract to supply Ford wheel bearing hub assemblies.