Volvo Truck’s Brazilian operation fosters economic development while providing the market’s most advanced heavy-duty trucks. Further, it combines safety with employee satisfaction and social responsibility. As such, it not only exercises a profound regional impact; it’s also considered Brazil’s best company to work for. Dan Harvey helps explain why.
In its 32 years, Volvo do Brazil-Latin America developed into a major manufacturing and economic force in its home country and surrounding region. A Volvo Truck Corporation subsidiary established in Curitiba (in Paraná, Brazil) in 1977, the company advanced local infrastructural and economic development with reliable transportation equipment hat helped transform wilderness into travelable territory. Today, its factory output accounts for a large percentage of Brazil’s heavy truck sales.
Further, by benefit of its robust sales and advantageous location within a strong, sustainable Latin American market, Volvo do Brazil supports its parent company’s global mission. Sweden-based Volvo Truck Corporation is the world’s second largest heavy-duty truck manufacturer with locations in more than 180 countries. South America, and Brazil in particular, represents one of its fastest growing areas. “We’ve become a crucial component in Volvo’s international system, as Brazil represents 60 percent of the Latin American heavy truck market,” observes Tommy Svensson, president of Volvo do Brasil-Latin America, who adds that “heavy” translates into 16 tons, more or less. “But new opportunities are emerging in Argentina, Chile, Peru and Venezuela. In addition, we’ve recently started working our way up to the southern Mexico border.”
IMPORTER BECOMES EXPORTER
Actually, Volvo’s Brazilian-based activities go back far earlier than Curitiba production. In fact, the company began importing products from its Swedish home base and into the region in the 1930s. In 1934, Volvo imported one automobile and four trucks into Rio de Janeiro. Within a year, imports increased to 81 units, thanks to the demonstrated product quality and durability that helped users successfully navigate Brazil’s then-existing roadways (only the most charitable would describe these crumbling, muddy avenues as transportation infrastructure).
For the next 40 years, light- and medium-weight trucks ruled these roads, and by the late 1970s, Volvo recognized the opportunity to introduce heavyweight vehicles into this harsh terrain. That initiated a production culture, as regional focus shifted from imports to exports. In the process, the Curitiba manufacturing facility became one of the region’s largest automotive production centers.
Today, the Brazilian operation’s output mirrors the parent company’s. Volvo do Brasil manufactures and exports the same models created in Sweden, indicates Svensson. Models represent the world’s most dependable trucks, as they feature elements that include chassis equipped with LKS (lane keeping support) mechanisms that monitor a truck’s road position; LCS (lane changing support) that effectively compensate for driver blind spots; ACC (adaptive cruise control) systems that allows drivers to safely negotiate their way into existing traffic flow without endangering themselves and fellow road travelers, and ESP (electronic stability program) that promotes safe and secure braking by distributing braking force throughout all vehicle wheels.
REGIONAL MARKET LEADER
In recent years, Volvo do Brasil has led the regional heavy truck market. “In 2003, we sold 5300 trucks in Latin America. Last year, we sold about 13,000, which represents a volume increase of about 140 percent,” reveals Svensson.
The Curitiba facility extends 1.3 million square meters and is staffed with 2,600 employees. “The plant supplies the rest of Latin America, but we also have a joint operation with Mack Trucks in Venezuela. The same factory produces both brands. But the Curitiba plant is our major facility for Volvo truck construction,” says Svensson.
However, Volvo do Brasil not only manufactures trucks. It also exports specific components (heavy diesel engines and truck cabs) to the United States, Europe, the Middle East, South Africa and Australia. The South American operations also include a 430,000-square-meter construction equipment factory, located in Pederneiras in Sao Paulo, where 700 workers produce articulated trucks, spades loaders, mini-loaders, motorbike dozers and diggers.
TAKING CARE OF BUSINESS
Volvo’s South American engagement is positive from both an economic and benevolent perspective. “We’re not only recognized for selling the most advanced product in Latin America’s transportation industry, but we’ve developed a reputation as an organization that takes care of its employees,” says Svensson.
Indeed, Volvo re-invests financial gains into employee health care, education and leisure activities. “We work with energy, passion and respect for the people. Brazilian citizens typically don’t have the ready financial resources to apply toward these areas,” Svensson points out.
This approach opened up a mutually beneficial two-way avenue. “As we demonstrate loyalty to our work force, our employees return that loyalty,” Svensson indicates.
Moreover, the work force’s loyalty combines with pride. “Our employees are proud to work for an organization that manufactures high-quality product, pursues extensive technological develop and has established a well-equipped facility that fosters personal and professional development,” says Svensson.
As such, it should come as no surprise that Volvo’s Brazilian operation earned significant recognition for its contribution’s to Brazil’s quality of life. In 2008, in an annual survey conducted by Você S/A-Exame magazines and Fundação Instituto Administração, Volvo do Brazil-Latin America was deemed the country’s best company to work for. The survey included 550 companies representing every business sector.
Each year, participating organizations undergo a strict selection and assessment process in what is considered to be the country’s most in-depth work environment study. Employee satisfaction is evaluated in three organizational categories: companies with up to 500 employees, 501 to 1,500 employees, and more than 1,500 employees. Rankings are based on investment into staff, compensation, benefits (including health care), training and work environment. “For the past four years, we’ve participated in the survey, which selects the 150 best companies from the large field of participants,” describes Svensson. “This was the first time we were listed as number one. The previous year, we made it into the top 10.”
The high ranking has a lot to do with the global parent company’s overall approach, believes Svensson. “The Swedish democratic system works quite well in Latin America. We work very closely as a team to manage resources, efficiency and productivity in an open manner. Few borders exist within the organization. Everyone works together to achieve shared objectives.”
Also, Volvo do Brazil-Latin America regularly invites dealers and customers into its production facility, an open-door policy that provides opportunities to discern future needs for clients and, in turn, the company. “By walking in the same direction as our customers, we determine how we can provide product development that will benefit both parties in terms of productivity,” says Svensson.
In its 32 years, Volvo do Brazil-Latin America has had enormous impact far beyond positive employee/management/customers relations. “We’ve helped transform the country by innovating in areas such as production, testing, safety for employees and users, and the environment,” reports Svensson.
Much of this is embodied in the product. The company’s heavy trucks are economically efficient, provide greater safety and produce less automotive emissions. Further, for at least two decades, safety initiatives have become more prominent. Again, this mirrors the parent company’s purpose, as safety has been a fundamental operating principle since the organization was founded in 1928. However, Volvo do Brazil-Latin America not only focuses in producing the safest product; it also promotes safe driving practices in its home company. “We’re quite aware that, in Brazil, 35,000 people die each year in traffic accidents. So, we strive to make the government and the public better aware of the danger, to underscore the importance of safety and value of life.”
For Volvo do Brazil-Latin America, success involves much more than just selling the most number of trucks. It involves social responsibility. This is especially important for Svensson, who has been with the Volvo organization for 35 years. Six of those years have been spent in Brazil. During that period, he developed a profound caring for the region and its inhabitants. “This is an attractive part of the world, and its people are very easy to work with and very eager to contribute positive accomplishments for the company and their country.”