Ryan Devine ▪ Michael Higgins ▪ Paras Kamdar ▪ Patrick Kaminski ▪ Michael Orton ▪ Ryan Waldron

US/MULTINATIONAL BUSINESSES IN BRAZIL

Attracting Global Business• 8th Largest Economy in the World (GDP)• Employment Structure

– Agriculture 19%– Industry 21%– Services 60%

• GDP Structure– Agriculture 6%– Industry 25% (Incl. 16% Manufacturing)– Services 69%

US/Multinational Businesses in Brazil

Oil & Gas IndustryInternational Oil Majors• BP (UK)

– O&G, Ethanol JV, Aviation Fuel, Lubricants, etc…– 4,200 Employees

• Chevron (US)– Growing Offshore Operations; Deep-water Heavy Oil– Lubricants Manufacturing Plants in Sao Paulo & Rio– 700 Employees

• Statoil (Norway)– Operator of Several Deep-Water Gas Wells– JV with Petrobas for Commercial & Technological Development

Oil Services• Many Rigs Transferred Post-Macando

US/Multinational Businesses in Brazil

Exxon MobilSenior Financial Corporate Controller• Business Support Center in Curitiba

– Global Financial Consolidation, Computer Services, Call Center– XOM US Subsidiaries Report Financial Data to Curitiba

• Young, Educated, English Speaking Workforce (Less $$$)– Lower Experience Level

• High Turnover & Currency Appreciation Eroding Benefit– Intense Competition for Services from International Firms– Offer More Training & Promotion Opportunities

• Minor Culture Adaptations– Longer Work Hours, Later Start– Lunch Subsidy, etc… is Government Mandate– Fewer Managers & Supervisors

US/Multinational Businesses in Brazil

Consumer GoodsBrazil Growing Market • Growth Through Acquisitions of Local Companies• Expansion of Local Brands

Pepsi vs. Coke• PepsiCo

– Partnership with AmBev (Largest Brewer in Latin America)– 9,000 Employees Across 19 Plants & Food/Beverage Facilities– November 2011 Acquisition of Mabel – Cookies, Crackers, Snacks

• Coca-Cola Brazil– 16 Independent Authorized Manufacturers– 53,000 Direct Employees Across 46 Plants– Over 150 Brands and Product Line Extensions

US/Multinational Businesses in Brazil

Consumer Goods• Unilever

– Food: Lipton, Bertolli, Slim-Fast, Ben & Jerry’s– Personal: Dove, Axe, TRESemmé, St. Ives

• Kraft Foods– Gums & Candies: Trident, Halls, Chiclets, Certs– Biscuits/Cookies: Nabisco, Club Social, Bon Gouter

• Kimberly-Clark– 3,000 Employees Across 4 Factories – Personal Care: Scott Paper Towels, Kleenex – Baby Products: Huggies Diapers/Wet Wipes

US/Multinational Businesses in Brazil

Auto Manufacturing• Brazil’s Fast Growing Car Market

– 5th Largest Automobile Market– 7th Largest Producer– Annual Production of Nearly 2,000,000 Vehicles– 1st Capitalist Company to Bring Together the 10 Major Car

Assemblers Inside its National Territory• Market Players

– Volkswagen– General Motors– FIAT– Ford

• Increased Import Tax on Foreign-Built Cars– Raise in 2011 to 35%– Mexico Free-Trade Agreement in the News

US/Multinational Businesses in Brazil

US/Multinational Businesses in Brazil

International Trade• Biggest Trading Partner – China • Trade surplus exporting raw materials – iron ore, soy beans and crude oil• Trade deficit in manufactured goods due to:

- Inflation- High Interest Rates- High Taxes- Poor Infrastructure- Lack of Proper Education/Training

• Intense competition in the manufacturing sector

• Protectionist measures to stifle imports and boost domestic output (i.e. 35% import duty)

• China is single largest investor in Brazil

Brazil & China

US/Multinational Businesses in Brazil

Brazilian Ethanol from Sugarcane U.S. government import tariffs and tax credits

(protecting ethanol distilled from corn) ended on Dec 31, 2011.

Opened the American market to sugarcane ethanol from Brazil

Brazil makes as much ethanol from sugarcane as U.S. does from corn

Joint Ventures – Ethanol Production

Dow & Mitsui Royal Dutch Shell & Cosan SA Cargill & Grupo USJ – SJC Bioenergia

Recent Developments

US/Multinational Businesses in Brazil

Multinational Presence in Brazil

US/Multinational Businesses in Brazil

Perguntas?