BMW and Brazilian Federal Government: Enhancing the Automotive Industry Regulatory Environment  

Oleh:

Navarro, Rodrigo ; Dias, Murillo ; Valle, Andre

Jenis: Article from Journal - ilmiah internasional
Dalam koleksi: International Journal of Arts and Sciences vol. 06 no. 02 (2013), page 551-567.
Topik: Brazilian government; Institutional relations; BMW; Negotiation; Inovar-auto
Fulltext: 06_02_38_Navarro_Dias_Valle.pdf (531.95KB)

Isi artikel

This paper presents a descriptive case study regarding the negotiations between the German automotive company Bayerische Motoren Werke (BMW) and Brazilian Federal Government (BFG) with the purpose to implement the company’s first automotive factory in Latin America. BMW announced on March 2011 to the BFG the intention to start manufacturing in the country. However, on September of the same year, BFG launched measures aiming to foster productive investments and protect the internal market, which included a 30 percentage points excise tax increase on non-locally manufactured cars. This significant change on the regulatory environment impacted directly BMW’s market access strategies under development at that time. Such governmental measures gave birth: (a) to a new automotive regime called Inovar-Auto and (b) the need for BMW to negotiate its strategic interests with BFG. The negotiations were successfully concluded on October 2012 with positive outcomes to all parties involved. This study throws more light on the strategic importance of Government Relations as a core competence for companies operating on strongly regulated business environments.

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