Genius or Joker? João Gurgel and the Lost Cars of Brazil
By Andy Bannister
As 2009 draws to a close, spare a thought for one of the lesser- known personalities of the auto industry to die this year, the enigmatic João Gurgel.
Largely unheard of outside his homeland, Gurgel was lauded by nationalists there as “Brazil’s Henry Ford”. He created a car brand which bore his own name and sold some decidedly outlandish creations in the years up to the early 1990s.
His dream of a mass-market, wholly Brazilian small car was brave but ultimately doomed.
Back in 1969, when enterprising 43-year-old businessman Gurgel set up his own tiny factory, Brazil was still a slumbering giant, with a small local auto industry. It was protected by strict regulations effectively preventing car imports.
A string of multinationals like GM, Ford, Chrysler and Volkswagen were, however, well-entrenched, manufacturing cars locally, and had the market all but sewn-up.
It was to Volkswagen and its Fusca model (better known elsewhere as the venerable Beetle), that Gurgel turned for the mechanicals which would set him on the road to his ambition of producing a car which was truly 100% a product of Brazil.
With the help of a simple fibreglass body using many other VW components underneath, he was soon turning out small numbers of the first of a number of utility off-roaders that the company soon became best-known for.
Models such as the Ipanema, Xavante, Tocantins and Carajás did modestly well in one of the largest countries on earth with more than its fair share of difficult terrain.
Cynics might add this was particularly so given that there was little or no alternative choice for buyers, especially at the lower end of the price scale.
Locally, the only competition came in the shape of big North American-style 4X4s and the smaller Toyota Bandeirante, Brazil’s version of the Land Cruiser.
During his often-controversial career, Gurgel’s company introduced at least 12 models, but the parallels with Henry Ford don‘t run deep. None of the Brazilian offerings had any lasting commercial success, even in the highly-protected home market, and many were little short of sales disasters.
Gurgel was nothing if not bold, however. His products were never ones to ape the competition, and the company soon developed a style of its own, particularly in the field of economy cars, where he had an especial interest.
A sign of things to come – and a design which in many ways was years ahead of its time – appeared in the mid 1970s in the unusual shape of the Itapiú, Brazil’s first (and so far only) indigenous electric car.
Poorly-made and by all accounts unreliable, it was never much of a sales hit, but it sowed the seed of João Gurgel’s dream to make Brazil a world leader in small car design and manufacture, to which his company would return in later years.
The country was experiencing a heady growth in auto production and exports in the 1970s. Fiat, which began manufacturing the 147, a local version of the Italian 127, was one of the big national success stories of the decade.
Gurgel offered Brazil’s leaders more than Fiat and the others could ever do – the dream of a motor industry that was not owned by foreign shareholders far away.
Consequently, the country’s government looked kindly on the entrepreneur and his plucky little company, showering them with loans and privileges which would far exceed any favour shown to his competitors.
As well as his SUVs, Gurgel soon diversified into characteristically odd-looking vans and small trucks, with designs spilling out of the fertile little factory at what seemed like breathtaking speed.
All were niche models, however, and the company never made a serious attempt to challenge bestsellers like the aforementioned Fiat 147, the Chevrolet Chevette and of course the Volkswagen Fusca and its many locally-designed derivatives.
Even at the height of its success, Gurgel only commanded 1% of the blossoming Brazilian new car market.
The company did have a remarkable ability to introduce models that were resolutely different. One such example, the XEF, had seemingly orthodox saloon car looks.
On closer examination, though, it sat three passengers abreast on the front seat but had no rear seating compartment at all.
The XEF sold in tiny numbers and was never more than a toe in the water, but the company got into terminal difficulties thanks to its persistent, but ultimately fruitless, ambition to crack the market for the country’s lowest-priced small four-seater car.
In theory, such a vehicle should have sold like hot cakes in crowded cities like São Paulo and Rio de Janeiro, as well as being a useful rural runabout thanks to high ground clearance and simple mechanicals.
During the 1980s, the then Brazilian president José Sarney granted large unguaranteed state loans to Gurgel to develop just such a car, the ambitious BR-800 model. Many private investors also unwisely backed the company, which always managed to have a positive profile in the country’s media.
Crucially, Gurgel also secured an unheard-of deal to ensure that buyers of the company’s new small model paid much less tax to the government on purchase than if they selected a mainstream competitor.
When it emerged, the BR-800, despite its overwhelmingly patriotic credentials, certainly needed help.
Having abandoned the trusted VW power plants which had served the company well up until then, the new all-Brazilian twin-cylinder engine was underpowered and the car was cramped inside.
It did, however, feature vaguely wedge-shaped styling which looked like nothing else on the market, with a flat windscreen and a particularly small glass area which must have hampered visibility.
By all accounts it was not a pleasure to drive or own, and few people were won over to this supposed motoring revolution.
The company was never geared up for mass production, which was probably just as well, as in its four years of existence, from 1988 to 1992, less than 4,000 BR-800s were made.
During these years, the company suffered a serious body blow which would hamper its future chances.
In 1990, new President Fernando Collor took office, and shortly afterwards the protectionism which had shielded Brazil’s car market from competition with the outside world was eased.
It says little for the quality of Gurgel’s SUVs that they were immediately threatened by imports of the Russian Lada Niva, which was cheaper despite an 85% sales tax, much more capable off-road, and considered to be a better-made product overall.
Collor’s government also ended the special treatment accorded to Gurgel’s BR-800, meaning its price advantage against small cars like Fiat’s locally-built Uno Mille was eroded. The Uno, although hardly the freshest model on the market, was bigger, faster and felt far more of a proper car, and Gurgel sales became harder and harder to come by.
The cold winds of reality must have hit Brazil’s Henry Ford hard, but João Gurgel was not a man to be beaten easily.
He still believed in the essential rightness of his small car design. The rather rudimentary looks of the BR-800 were smoothed out to create a somewhat more conventional model called the Supermini.
It was too late, though. With the free market gaining strength in Brazil, and no real groundswell of popularity among buyers for the company’s vehicles, the new car stood almost no chance. Only 1,500 Superminis were sold in the next two years.
A remarkably peculiar, if inventive, open-topped derivative, the Moto Machine, was even less of a success.
The collapse of Gurgel’s traditional SUV sales by 1991 and the commercial failure of the its small cars meant the company was in desperate trouble, and loans were increasingly hard to come by.
Gurgel’s last design, the Delta, never made it past the prototype stage. This was an even more pared-down utility car which was to have sold at a very low price, but in the end it was stillborn.
By the close of 1992, the company couldn’t afford to pay its workers, and production more or less ended, although technically the outfit didn’t go bankrupt until 1994. Millions of dollars of loans from various Brazilian institutions were never repaid.
After his fall, critics rounded on Gurgel, saying he surrounded himself with yes-men and lived in a state-bankrolled dream world, and accusing him of taking millions out of the country.
In retirement, though, he consistently refused to accept any responsibility for his company’s fate, blaming politicians and the system for ultimately wrecking his dream of a national motor company.
The man behind the all-Brazilian car developed Alzheimer’s disease in later life, and died early in 2009.
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