The recent 50 % rates imposed by the United States government to products from Brazil, which began to be applied since August 1, are reconfiguring the scenario of international trade and two Brazilian giants already feel the impact: Taurus Armas, world leader in light weapons, and Embraer, the third largest manufacturer of commercial planes of the world.
The measure, taken as part of the “national emergency” economic policy decreed by the North American country, directly affects Taurus, which exports more than 80% of its production to the US market and responds for one third of the weapons segment with value up to $ 350 in that country. Although the company has a plant in Bainbridge, Georgia, capable of producing 3,000 weapons a day, still depends on raw materials and components imported from Brazil, also under tariff threat. “We are adapting the supply chain to minimize the impact of these rates,” says Salesio Nuhs, CEO of Taurus.
The company already foresees a price increase in its most popular models in the United States and studies redirecting part of Brazilian production towards other markets.
Although Embraer assembles airplanes in Florida and maintains strategic relationships with US airlines, industrial products rate would also reach full parts, components and aircraft made in Brazil.
However, the firm has managed to stay completely out of the list of Brazilian products affected by new tariffs. The company-which supplies the US planes such as the KC-390 Millennium-carried out a discreet negotiation that culminated in the exclusion of its sanctions aircraft.