After setting up production in South Korea to increase the company’s presence in Asia, the time has come to further invest in the South American market. For 12 years, LEGO bricks are produced in Manaus in the northwestern part of Brazil.
Focus on the South American market
With the aim of entering the South American market, the LEGO Group builds a factory in Manaus, Brazil. It begins operating in 1986, molding the first LEGO® brick on April 4. In addition to the factory, a sales office is set up in Sao Paulo.
As in the case of the setup of a production facility in South Korea in 1985, the LEGO Group establishes the factory in Brazil for several reasons. The country’s economy makes it possible to set up a local manufacturing site, which provides a base from which to enter a market already containing several copy products. Locating the factory in the city of Manaus, about 3,500 km from Sao Paulo, benefits from the region’s status as a free‑trade zone.
The factory houses a finished‑product packing line, two pre‑pack lines, a decorating area, and a small number of molding machines, which in the hot, humid climate require a special air‑conditioning system. Approximately 60 people are employed at the Manaus factory.
In 1998, it is decided, for a number of reasons, to discontinue production at Manaus. For one thing, sales are concentrated predominantly around Christmas. At the same time, many political changes in the country make it difficult to conduct business in the Brazilian political system. With the Brazilian market slowing down, the LEGO Group believes it can easily meet the needs of the market from its factory in Enfield, Conn., USA, which has become the headquarters of all LEGO Group activities in North, South and Central America.