10. Read the text about Dell's plans to assemble pCs in South America and do the tasks that follow.

Dell tries to crack South Americ

aJohn Barham examines the US computer maker's strategy for expansion using a Brazillian base

Dell Computers, the Texas- based computer-maker that was among the pioneers of online ordering, is preparing to attack the difficult Latin American market.

Soon, Dell will start making computers at a new factory in the small, southern Brazilian city of Eldorado in its first manufacturing venture in South America. Within a few hours' flying time of Eldorado lie four of the conti­nent's main metropolitan regions - Buenos Aires, Rio de Janeiro, Sao Paulo and Santiago - which gener­ate about half the region's wealth and where most of the computer- using populace is concentrated. Dell hopes to serve all these markets - including more distant regions in northern Brazil and th

e

Andean countries - from Eldorado.

According to Dell's plan, aircraft from Miami will land at a nearby international airport car­rying computer components that will be sent straight to Dell's factory. Together with parts delivered from suppliers in Brazil, they will be assembled to order, packed and delivered to consumers across the continent.

The challenge for Dell is not only to mount an effective marketing campaign to educate customers about online ordering, it must also manage a complex logistics system and deal with the problems of unreliable road and air transport networks. And it must operate in half a dozen volatile Latin countries, with unpredictable governments and consumers as well as well- established competitors.

Dell could not afford to ignore the South American market much longer. It currently exports computers to a few Latin American countries such as Mexico and Colombia, but has never sold to markets in Argentina or Brazil. Latin American consumers last year bought 5 million PCs and demand is growing at 15 per cent a year. Growth is likely to remain strong for some time to come: in Brazil, the region's largest market, only 3-

4. per cent of the population owns a PC.

Dell is not the first company to view South America as a single market. For a decade, Ford and Volkswagen and many other multinational companies have operated in the region's main countries as if they formed one integrated market. That was a natural reaction to falling import tariffs and consolidation of the Mercosur customs union linking Argentina, Brazil, Paraguay and Uruguay. However, the distances, the red tape and the animosities between national governments often make fulfillment of this strategy difficult.

Dell decided to locate in Brazil so because it is the region's biggest market and because the government gives computer companies substantial tax incentives as part of its plan to develop local high technology industries. If Dell meets Brazilian local content criteria and attains agreed production volumes, its products are considered to be 100 per cent locally made and automatically gain duty-free access to Mercosur countries. However, there is little Dell can do about the internal transport networks in Brazil or the bureau­cracy in neighbouring countries. Although roads, air transport and delivery systems are tolerably efficient in south eastern Brazil and parts of Uruguay, Chile and Argentina, Dell may still find it isstruggling to co-ordinate opera­

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tions and sales over a vast region.

Answer these questions. r

1. Is the writer generally positive about Dell's chances of success in its South American venture?

2. Why has Dell decided to attack the South American market?

3. Based on the information in the text, which country is the odd one out, and why?

a) Colombia b) Argentina c) Brazil d) Paraguay e) Uruguay

4. Why has Dell chosen to locate its manufacturing plant In Brazil?

5. Which of the following 'challenges’ facing Dell are mentioned in the> article?

1. unreliable transport networks e) large distances

2. poor productivity f) high import tariffs

3. political instability g) terrorism

4. high inflation h) well-established competitors

В Mark these statements T (true) or F (false) according to the information in the text. Find the part of the text that gives the correct information. -■

1. Dell will sell only in the big cities.

2. Dell already sells computers in South America.

3. The company also produces PCs in Mexico. >

4. It plans to import all the components it needs.

5. Ford and Volkswagen have been operating in South America for some , years.

6. Considering South America as a single market is not an easy strategy.

7. To meet'local content criteria'Dell must use a certain percentage of components produced locally. f

8. Dell hopes to sell its computers duty-free in many countries.

9. Delivery systems in Brazil are better than in other parts of South _f America. ₍

C Complete the sequence of steps in the planned assembly and

delivery of Dell’s PCs. (para 3) J

1. components arrive by plane from Miami

2

3

4

5

D These phrases summarize the main idea of each paragraph. Match each phrase to the correct paragraph.

1. the challenge for Dell

2. reason for choosing Brazil

3. an overview of Dell's intentions

4. reason to enter the South American market

5. how Dell's plan will work

6. other companies' experiences

7. problems Dell may face in Brazil and elsewhere

8. advantages of Eldorado's location

E Find a word or phrase in the text that has a similar meaning.

1. one of the first to do something (para 1)

2. buying something through the internet (para 1)

3. business activity with some element of risk (para 2)

4. general population in a country (para 2)

5. a difficult task which needs skill and determination (para 4)

6. describes something or someone that can change quickly and suddenly (para 4)

7. lots of rules and regulations, which often seem to have no purpose (para 6)

8. strong dislike between people or groups (para 6) '

9. reach or achieve an objective (para 7)

10. trying very hard to do something under difficult conditions (para 8) ,,

Si

F Collocations