GM headquarters in São Caetano, Brazil. After bankruptcy and state-promoted recovering in the U.S., the company invests in Brazil
General Motors of Brazil announced today the investment of R$ 2 billion in the country. This is the car company’s first investment in Brazil after the process of restructuring of its headquarters in the U.S., which ended last week.
About 50 percent of the investment will be made with the company’s own resources; the rest will come from state banks. Barisul and BRDE (Regional Bank for Economic Development) are already in the project, and there are negotiations with BNDES – BRDE national version.
Of the total amount of money, R$ 1.4 billion will be invested in the development of vehicles and in the expansion of GM factory in the state of Rio Grande do Sul, which is responsible for the production of Celta and Prisma. From now on the factory will also produce a new family of compact cars: the so-called ‘Project Onix’ will have Brazilian design and engineering.
Employment
The expectative of the company is to generate one thousand direct jobs and up to 7 thousand indirect jobs in Brazil. In 2009, GM will also invest in the technological development of new vehicles in its center in São Caetano (city part of Sao Paulo).
With all those new investments, the company hopes to achieve a national production of one million cars – nowadays, it is between 800 and 900 thousand unities. Jaime Ardila, president of General Motors of Brazil, stated that the vehicles will be destined to both Brazilian and South African market.
Sales
Automobile sales in Brazil soared 21.5 percent in June from May, turning in a record month as a combination of tax breaks, lower prices and improved confidence prompted consumers to flock to showrooms.
“If state banks hadn’t financed clients and if private banks hadn’t turned themselves to the market, it would be hard to keep the sales. There were two important things: tax breaks and credit”, stated Ardila.
