Emerging telematics opportunities in Brazil

01 Jul 2010

South America's largest economy, Brazil, is world's sixth largest car and truck manufacturer, and last year accounted for five percent of total vehicles sold in the world. At the same time Brazil is facing one of the highest rates of vehicle thefts worldwide.

As the government introduced legislation making it mandatory for vehicle manufacturers to outfit tracking devices on all vehicles, consumers complained about violation of their rights by making them pay for the anti-theft device even if they didn't need it. Others object to tracking devices out of privacy concerns.

According to Roger Dewey, chief executive of M2MV, a U.S.-based telematics consulting firm, the biggest issue in Brazil is market perception. By making tracking devices a requirement for every vehicle, the government „struck the population in a very negative context."

In addition to privacy concerns people regard the obligatory devices as a disguised tax. This sort of consumer reaction also prompted automobile manufacturers to oppose the idea. Installing a tracking device increases the cost of the vehicle, and manufacturers fear decreases in sales figures.

Fiat, the largest automobile player in Brazil, openly urged the government to reconsider the bill's provisions.