1. Expansion of the thermal business

[7] Acquiring MMCL and establishing DENSO SISTEMAS TERMICOS do BRASIL LTDA. (DTBR)

After becoming depressed by the currency crisis of 1999, the Brazilian economy achieved rapid growth in the 2000s due to a dramatic increase in primary commodity exports and robust consumption demand brought about by a growing middle class. As a result, Brazil began to attract attention as a member of BRICs.
The automotive industry also saw a remarkable recovery, with Brazil’s largest automobile manufacturer, FCA [established through a merger of Fiat of Italy and Chrysler of the US], boosting production capacity at its Fiat and Jeep brand SUV and pickup truck plant in Betim. At the same time, FCA built a new plant in Goiana, Pernambuco. Although Pernambuco was far from FCA’s existing plant in southeastern Brazil, the new plant was seen to be advantageous in terms of transporting completed vehicles because it was located in a coastal region.
FCA also established a research center to develop new vehicle models and platforms at the new plant, and formed an industrial park nearby to encourage entry into the region by part manufacturers. Since northeastern Brazil was a low-income area, the region established a new tax incentive system and sought to integrate industries at plant sites that the state government had prepared.
In response to these efforts, DTBR also moved into FCA’s supplier park in Pernambuco. DTBR rented a building from FCA in order to engage in production. However, as the plant complex was built in an area that was completely undeveloped, the region lacked the infrastructure required for daily life and the local human resources had limited plant production experience, making it difficult to recruit and train associates.
Later on, DTBR would continuously expand the production capacity of the Pernambuco Plant, and advance the introduction of new technologies. At present, it produces and supplies HVACs, ECMs, and front end modules.