Bloomberg News

Nissan-Renault to Build New Brazil Plant, Upgrade One

October 06, 2011

(Company corrects Ghosn’s comment in the third paragarph of article published Oct. 1.)

Oct. 1 (Bloomberg) -- Nissan Motor Co. and Renault SA plan to build a second factory in Brazil and upgrade an existing one to increase market share in the largest Latin American economy, Chief Executive Officer Carlos Ghosn said.

The new plant is to be built in Resende, in Rio de Janeiro state, said Ghosn today at a news conference in Brasilia after talks with President Dilma Rousseff. The factory in Sao Jose dos Pinhais, in Parana state, is to be upgraded. Ghosn said more details about both plants will be released next week.

“Brazil is going to be Renault’s second-biggest market in the world by the end of this year,” said Ghosn, who is Brazilian-born. “We want to be able to go beyond our present 8 percent market share in Brazil.”

Car sales have been increasing more than 20 percent a year for the past few years in Brazil, the fifth-biggest auto market in the world. To keep its market from being flooded by cheaper foreign cars, Brazil on Sept. 15 raised its tax on autos with less than 65 percent of their content produced in the country, Mercorsur or Mexico.

Ghosn said the 65 percent local-content requirement is not unusual, with it being closer to 90 percent in China, and it’s no impediment for investing in Brazil.

He said details about the amount to be invested, the capacity of the factories and the number of new jobs to be created will be disclosed Oct. 5 at the Sao Jose dos Pinhais plant.

--Editors: Jamie Butters, Bill Koenig

To contact the reporter on this story: Jose Sergio Osse in Sao Paulo at josse1@bloomberg.net

To contact the editor responsible for this story: Helder Marinho at hmarinho@bloomberg.net


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