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The company opened an inverter factory in the Manaus Free Trade Zone with a capacity of 1.8 GW, or 300,000 units per year. In the second phase, it plans to bring in the production of hybrid inverters and lithium batteries as well as chargers for electric vehicles and motors for electric boats. The company will have distribution centers in Curitiba and Fortaleza to ensure rapid delivery of equipment to the domestic market, with a minimum warranty of 10 years.
Livoltek, a Hexing Group company, has opened its first factory in the Manaus Free Trade Zone, in an investment of more than BRL 70 million ($12.4 million). The Chinese company chose the capital of Amazonas to produce photovoltaic inverters, lithium batteries and electric vehicle chargers to serve the domestic and international markets, with an eye on Latin America. The industrial complex spans 18,000 m² and is expected to generate 600 direct jobs and more than 2,000 indirect jobs.
Initially, considering current market conditions, the factorys production capacity is designed to deliver 1.8 GW, or around 300,000 inverter units. However, it could reach up to 3 GW without the need for new investments in machinery, just by increasing the number of shifts and workers.
The factory will go through three phases, which is expected to be completed by the first quarter of 2025. The first involves the start of manufacturing on-grid inverters, the second will mark the start of production of hybrid and off-grid inverters, chargers and batteries, and the third, electric boat motors and other inverters.
Equipment produced in the country should become more competitive compared to imported equipment due to fiscal, tax, logistics and commercial factors, said Livolteks general director in Brazil, Thiago Varanda. Hexings experience with the Eletra Energy brand, which manufactures energy meters in the country, where it boasts a market share of approximately 70%, was an important factor in convincing the holding company to also invest in the local production of inverters.
“A lot of research was done to understand whether the inverters, batteries, chargers and electric boat motors really made sense to be manufactured here in Brazil, and whether they paid for themselves. And yes, they do,” the executive told reporters after the factorys inauguration. In addition to the tax and fiscal advantages of investing in the Manaus Free Trade Zone, products manufactured in Brazil will be better suited to the Brazilian market, being subjected to tests that reproduce the countrys field conditions, said Varanda.
Removal of ex-tariffs on inverters, logistical advantages and exchange rate protection
In addition, there is a prospect of a reduction in tariff exceptions (ex-tariffs) on inverters with similar specifications. “When you have a product that is not manufactured in Brazil, there is a benefit from the ex-tariff. As a manufacturer, this benefit will certainly have some restrictions and, subsequently, we will have an even greater difference in the price of this product compared to the international price,” Varanda said. An initial study conducted by the company indicated that this removal of ex-tariffs could generate an 18% difference in relation to the price of the international product, he added.
The recent increases in the cost of international freight and the dollar also reinforce the competitiveness of national products, Varanda noted.
Livoltek sales director Mateus Gomes stressed that the company would count on the support of Eletra’s distribution centers, forming inverter stocks in Fortaleza and Curitiba, in addition to the factory in Manaus. When these stocks are formed, minimum delivery time could then reach up to five days from the order, depending on the location.
“From the factory in Manaus, the equipment goes by boat to Belém and from there it is shipped to the rest of Brazil. Supplying these distribution centers in Fortaleza and Curitiba will initially take 15 to 20 days, but later we will work with times of five to 10 days depending on the final delivery. So logistics is what we are focusing on a lot, even in advance, to quickly meet this operation,” said Gomes.
Progressive nationalization of inputs
The Livoltek factory will produce everything from inverter bodies and chips to printed circuit boards, but in the first months of production, the inputs will mostly come from China. Preliminary studies indicate that the share of national inputs could reach 70% of the equipment.
“Its a new factory, and there will even be test production in August and September,” Varanda said. “Were already taking orders, very focused on October production,” Varanda says. “At first, we wanted to understand if the entire manufacturing process was correct, so we didnt want to take the risk, lets put it this way, of having a supplier qualification process running parallel to the manufacturing process. So at this first moment, the production chain is made up of Chinese inputs; the tendency is for us to have as many nationalized products as possible and I want to build this over the next 18 to 24 months. This is my mission and Livolteks mission, precisely so that we have this control of the chain, dont suffer from sea freight, dont suffer from changes in the dollar, but we know that there are some products that are not produced in Brazil.”
The company is already working to become accredited as a local manufacturer with the Brazilian Development Bank (BNDES) and other development lines, he added.
Headquartered in China, Hexing has factories in Indonesia and Africa, as well as operations in Europe. The investment in the new factory in Brazil will help the country, which is already one of the leading players in the global photovoltaic market with new installations, to position itself as a significant player in the manufacture of equipment for this industry, Varanda explained.
“First were going to supply the domestic market, thats the plants objective, and then were going to supply the Latin American market,” he told journalists after the plants inauguration. “Were moving from being a consumer to also being a manufacturer.”
Regional potential
For the company, in addition to the tax and fiscal advantages offered by Manaus, the location of the factory also brings it closer to potential markets in the North Region, especially in the case of electric boat motors and battery systems. The region uses the river transportation system and has many places disconnected from the electricity grid, with diesel consumption in both cases. In addition, as it is a hot region, there is a high consumption of air conditioning even at night, which could encourage the adoption of batteries in distributed generation systems, to store energy generated during the day and used at night. |
