Wrtsil, the Finnish-based supplier of engines and power systems, expects strong growth in its Brazil-led South American operations.
“Definitely Brazil is a major focus area for Wrtsil Tomas Hakala, Wrtsil president in Brazil, tells GTR . “From a point of view of power plants, there is very big potential.”
Brazil is set for at least 4% growth in installed capacity in the next 15 years, says Hakala, citing government forecasts. Energy auctions in Brazil represent strong potential for the Finnish company, he adds.
South America makes up 5-8% of Wrtsil’s global sales, and Brazil, which is the company’s leading market in South America, accounts for as much as 5% of the corporation’s total revenue. Business potential in Ecuador, the second-biggest market for Wrtsil in the region, stems from foreign oil and gas companies operating in the country. Wrtsil does not deal with the government of Ecuador, but only the private sector, Hakala remarks.
The Brazilian shipbuilding industry is responsible for 50% of Wrtsil’s local sales, and the remainder equals land-based customers. In comparison, the Ecuadorian market is predominantly land based, while Venezuela, Chile and Argentina are essentially for ships, he comments.
In South America, 30% of sales amount to new equipment and machinery to the shipbuilding industry, whereas another 30% are fresh machinery and equipment to power plants. The remaining 40% come from after-sales activities, parts and services.
Hakala says that a shortage of skilled engineers in Brazil constitutes a major problem. Wrtsil has production facilities in the European Union and China, and will start producing Brazil in 2008 through a licensee.