Renault-Nissan planning to build a new factory in Brazil

Article by Christian Andrei, on October 3, 2011

As part of a plan to strengthen Renault-Nissan’s presence in Brazil (the world's fourth largest car market), it is planning to construct a new factory and to expand an existing plant there. It trails China, the U.S. and Japan. Carlos Ghosn, chairman and chief executive of Renault-Nissan, told reporters that Nissan vehicles will be built at the new plant in Resende, located about 56 miles (90 km) from Rio de Janeiro.

The group will also expand its main factory in Sao Jose dos Pinhais, where Renault vehicles have been produced since 1998 and where Nissan pickups and trucks are currently assembled.

At the press conference at Brazil's presidential palace, Ghosn said that Brazil is likely to become the “No. 2 market for Renault after France", says Autonews.

Ghosn said that the light-vehicle output in Brazil is expected to increase to more than 4 million annually from more than 3 million today within five years. It overtakes Japan for the third spot. Ghosn said that Brazilian-assembled Nissan models will then have about 65% locally made content.

Nissan currently imports majority of the vehicles it sells in Brazil, mainly from Mexico. Nissan manufactures the Frontier pickup and Livina cargo van at the Renault facility in Sao Jose dos Pinhais.

If Nissan builds cars in Brazil with at least a local content of 65%, it could avoid a 30 percentage point increase in Brazil's Industrialized Products Tax. Last September, this tax was imposed on imported cars in September to delay the surge of auto imports, mainly from Asia.

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