On October 17th, Portobello celebrated the grand opening of its new U.S. facility in Baxter, Tennessee. I had the opportunity to tour the 900,000 square foot facility and hear about the company's plans for production. I sat down with Luiz Brito, CEO, Portobello America, to learn more about how the company is positively impacting the local economy, how it weathered the pandemic, and his predictions for the market going into 2024.
Here are the main takeaways from our conversation, which you can listen to in its entirety below.
The United States facility is the third plant to be added to the Portobello Grupo portfolio. The firm is now poised to better serve the U.S. market. According to Brito, the U.S. project began approximately six to seven years ago. They started by choosing the best location that was in closest proximity to raw materials and their distributors. The next phase included choosing the right equipment, factoring in for the taste of an American market that is very different from the Brazil market.
Brito says that the suppliers are basically the same, but the products must be manufactured differently to meet the demands of a different market. So, that means Portobello America’s new plant is focused on flexibility rather than “super production.”
“We built a plan focused on flexibility to be able to attend [to] the client needs here in the United States,” said Brito. “It's a very sustainable factory with all the best equipment you can imagine.”
Production began in August of 2023 with a little over 200 employees. However, once the second kiln is added next year, that should bump the number up to somewhere around 240, said Brito.
The company brought in its top Brazilian employees to train the American employees. Ten to 15 employees from the Brazil facilities will rotate out every two months until the new facility is complete, and everyone is trained.
According to Brito, the locals are excited to see more jobs come to their local community. Working with the Tennessee and local officials, Portobello was offered incentives to make Baxter its U.S. home.
“As the Baxter Mayor said today in our event, it's new houses, new restaurants, new hotels; it's the community preparing itself to receive companies like ours,” Brito said. “We are very proud.”
As for the market outlook for next year, Brito acknowledges the tough economic road ahead, “We know it's not gonna be an easy market ahead of us, but on the other side, we see that as an opportunity. People are talking about a recession, housing starts declining, and all of that is true. We have to face it, but at the same time when we have a situation like that, I have no doubt that our clients— the distributors, are gonna look for domestic producers—people that can back them up in terms of inventory.”
Currently, the company is building phase one of its factory which includes three kilns. The first kiln is producing porcelain, “from 12x24 to 24x48, rectified, color body, polished, everything is already working,” said Brito. The next line will be operational in a few months and will produce small format tile.