Vision Blooms in Latin American Markets

What's the difference between North, Latin, South, and Central America? North America Includes Canada, the United States, Mexico, Central America, and the islands of the Caribbean Sea. (Sometimes excludes Mexico, Central America, and the Caribbean.) Latin America Usually includes the countries south of the United States, including all of South America. South America Includes the countries of South America south of Panama but sometimes includes the portion of Panama south of the Isthmus of Panama. Central America Includes the countries south of Mexico to north of Colombia - Guatemala, Belize, Honduras, El Salvador, Nicaragua, Costa Rica, and Panama. Sometimes includes the area of Mexico east of the Isthmus of Tehuantepec, such as the Yucatan Peninsula. Source: www.about.com

Although machine vision sales revenue for South America is difficult to obtain, local vendors estimate that the machine vision integrator pool has grown to nearly 100 companies, and many North American and Central American vendors and integrator's also serve South American markets.

‘‘Machine vision is very new in Latin America,’‘ explains Alessandro Koerich, Vice President Administration and Finance for InviSys Machine Vision Ltda (Curitiba, Brazil). ‘‘In the last five years machine vision in Latin America has experienced fast growth mainly due to the availability of smart cameras.’‘ InviSys was founded in 2004 and has experience in the areas of computer vision, artificial intelligence, software engineering, and industrial automation in the Brazilian and South American markets.

Jose Rizzo Hahn, CEO of POLLUX (Santa Catarina, Brazil), characterizes the Latin American market as a ‘‘fast follower’‘. ‘‘Unfortunately, there is no hard data available in terms of revenues, but it could be certainly much higher if was not for the incredibly high import and sales taxes, which can make the exact same solution two times more expensive in Brazil than in the U.S.,’‘ Hahn notes.

Latin American Industries
Pollux is organized into five business units, representing the main industries using vision in the South and Central American markets. ‘‘In our specific case, they are (in order of importance): automotive, pharmaceutical & health care, packaging, and electronics. In smaller scale, we have developed solutions for the printing industry and for those requiring surface inspection,’‘ Hahn says. With the exception of the semiconductor industry, which is non-existent in Brazil, ‘‘...the industries using vision are basically the same as in the U.S., Europe, and Japan.’‘

The comparison between Latin American markets and machine vision applications around the world is an apt one, as illustrated by the types of systems being built at Prefixa Vision Systems (Puebla, Mexico).

‘‘For the packing industry (e.g., food processing and packaging), common applications include the quality control of packaging, number of items inside boxes, or cleanliness of bottles,’‘ explains Dr. Miguel Arias, CEO and President of Prefixa Vision Systems. ‘‘For automotive, vision guided robotics are a main application, subdivided into quality of positioning, alignment, quality of welding, etc. Pharmaceutical applications focus on liquid level and particle detection inside ampoules. In electronics contract assembly [not semiconductor], there are machine vision solutions for the PCB assembly and component verification. In metal-mechanics, infrared imaging for quality control based on temperature monitoring is required.’‘

Unlike many vision integrators in Latin America, Prefixa is developing its own hardware to target these markets, including a new 3D camera for micromechanical inspection and infrared (IR) sensor for process control in the metal industry. Arias feels there is a benefit to hardware originating from the Central and South American markets, in addition to importing goods.

‘‘Cultural differences are important,’‘ Arias explains. ‘‘In Mexico, integrating innovative systems in a production line where all the components are [imported], isn't viewed very well by the customer -- even if you prove there could be improvements in the quality process.’‘ And of course, there are always the stiff import fees that domestic equipment would avoid.

Imports and Challenges
Import fees represent one of the largest barriers to non domestic companies doing business in South and Central American countries. ‘‘In our opinion the cost of a machine vision system is the most important difference between Latin America and other markets,’‘ notes InviSys' Koerich. ‘‘We are subject to very high importation fees that sum up to about 90% of the total equipment costs. Besides that, there is also the exchange rate (Brazilian Real/ US Dollar) which is about 2.2:1. Most of the small and mid-sized Brazilian companies cannot afford a machine vision system. Furthermore, many Brazilian companies have the opinion/idea that it is less expansive to have people doing quality control than a machine vision system. Very few are aware of the benefits of automated quality control.’‘

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To combat a manual labor culture, Latin American vision suppliers have to be willing and able to develop proof-of-concept systems and show how their systems are cost effective. ‘‘There is not much culture for clients in Mexico to pay for proof of concepts in small projects, as opposed to well defined off-the-shelf inspection products,’‘ explains Prefixa's Arias. ‘‘So either you go with your own resources to show feasibility, which consumes time and money, or you can propose a solution similar to a costly existing product as an alternative. There are other opportunities for machine vision, mainly related to substituting legacy equipment with less costly vision systems that have easier maintenance and also part availability, particularly in the food industry inspection area.’‘

Conferences and expositions are growing to support the Latin American vision market, mainly through industrial automation shows that give machine vision suppliers a chance to show what their systems can do compared to hard automation. Currently, ISA supports three shows in Mexico and one in Brazil. These shows offer excellent opportunities for vision companies interested in the South and Central American markets to network, explore, and build bridges. Unlike some countries, North American and European vision suppliers should be able to quickly adapt to Latin American cultures and ways of doing business, although business conditions could be better, as Pollux's Hahn explains.

‘‘Having lived and worked in the US for five years, I dare to say that conducting business in Brazil, on the interaction side, has many more similarities than differences when compared to the way business is done in North America or Europe,’‘ concludes Pollux's Hahn. ‘‘Brazil is a melting pot, and a lot of our culture was influenced by the Europeans that moved into the country few centuries ago. Nevertheless, the similarities stop right there. Over here we are in the middle of one of the most complex and ineffective business environments within a developed country, as it relates to bureaucracy, laws and taxes in general. The cost of doing business in Brazil is pointed by many international institutes as one of the highest worldwide.'