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GE Healthcare factory debuts in Brazil
Amidst a flurry of good economic news coming out of Brazil in recent days, GE Healthcare added its own boost — inaugurating its first factory in South America in Contagem, Brazil. News of the plant, which will serve both the local market of Brazil and eventually become an export hub for all of Latin America, comes as a new United Nations report on the region expects the economy of Latin America and the Caribbean to expand “by 5.2 percent in 2010, up exponentially from a previous view of 4.1 percent,” Reuters reports, adding that “the body sees the economy of Brazil, the region’s biggest, soaring 7.6 percent in 2010 and 4.5 percent in 2011.” In the video clip below, Mark Vachon, president and CEO of GE Healthcare Americas, provides an overivew of what the new GE plant will be producing and why Brazil was chosen.
The new Healthcare plant will be one of the immediate beneficiaries of the new Global Research Center, as beginning in 2013 the lab will help initiate development of products geared specifically to meet local market needs. It’s part of GE’s “reverse innovation” strategy, currently active in countries such as China and India, in which products are developed in local markets and tailored for local market needs.
Brazil already accounts for approximately 40 percent of GE’s South American revenue — $7.5 billion in 2009 — and this year marked the 90th anniversary of GE’s presence in the country. It also coincided with GE’s recent announcement that it plans to locate its fifth Global Research Center in the country, joining the ranks of GE’s other labs in China, Germany, India and the U.S. The centers are the technology development hubs for all of GE’s businesses.
Thinking big: The Brazilian healthcare market is currently worth $600 million and the entire Latin America region is worth $2 billion. Both markets are growing at a rate of 8 percent a year. The inauguration press conference is pictured above.
As GE Chairman and CEO Jeff Immelt wrote in a recent op-ed, published in Brasil Econômico: “From regional jets and autos to mobile phones and food and beverage, Brazil has tremendous capacity to become a leading global supplier of inputs, components, and finished goods…. Indeed, right now GE is working with BNDES [The Brazilian Development Bank] on opportunities to enhance Brazil’s competitiveness in manufacturing and services in areas such as wind power and aviation.”
Echoing the surge of optimism about Brazil’s growth, The Economist magazine observed earlier this year that “new skyscrapers are going up along Avenida Faria Lima in the business district of São Paulo. Sales of computers and cars are booming, while a glut of passengers has clogged the main airports. Brazil created 962,000 new formal-sector jobs between January and April — the highest figure for these months since records began in 1992. Everything indicates that over the past six months the economy has grown at an annualized pace of over 10 percent. Even allowing for an expected slackening, many analysts forecast that growth in 2010 will be 7 percent — the highest rate since 1986.” The boom has also caught the attention of Chinese investment dollars, with The Washington Post reporting that “in the first half of this year, China’s investment in Brazil topped $20 billion, more than 10 times all of China’s previous investment in the country. That puts China on track to be Brazil’s No. 1 investor for 2010, compared with 29th in 2009.”
Poised to expand: The plant will manufacture the DF-R x-ray system, one of GE’s healthymagination-certified products. In addition, the facility has manufacturing capabilities for mammography and remanufacturing of a number of diagnostic imaging products. In the future, the plant will expand manufacturing to include Positron Emission Tomography (PET), Computed Tomography (CT), Magnetic Resonance Imaging (MRI) and Monitoring Systems.
Training hub: Another important initiative at the plant planned for 2011 will be the launch of the first training center for GE Healthcare engineers in Brazil and Latin America. This training center will focus on the transfer of knowledge, training of local service employees and the qualification of suppliers in GE’s environmental and work safety standards.
