Mercedes-Benz is adding production of the C-Class in a new plant in
Iracemapolis, near Sao Paulo, Brazil,
Daimler AG, which owns Mercedes-Benz,
has just broken ground on the new plant where production is due to start in the
first quarter of 2016 with the C-Class sedan.
This model will be
followed with production of the GLA sport-utility vehicle (SUV) as well.
“Local production
will even better allow us to tap the potentials of the emerging Brazilian
market and to respond more flexibly to the wishes of our customers. In the
first stage, we are aiming for an annual capacity of 20,000 vehicles. If the
market will develop as hoped for, the plant has the potential for a further
significant expansion in the future,” noted Markus Schafer, member of the
divisional board of Mercedes-Benz Cars, Manufacturing and Supply Chain Management.
The plant is
expected to open up 600 jobs, but also to have significantly less automation
than other facilities.
One implication of the latest move is that Mercedes-Benz is returning to
passenger car production in the region, having built the A-Class in Brazil from
1999 to 2010 at its Juiz de Fora plant, a facility that plant now builds
commercial vehicles.
Forecasts of the volumes
likely to be generated from the plant are in the range of about 11,000 units a
year through this decade, split roughly evenly between the two products.
Audi and BMW are
among the luxury makers adding production in the country as well as
Mercedes-Benz. Brazil’s Innovar Auto taxation programme makes in-country
production advantageous at present, even at low volumes.
Mercedes-Benz first
announced its plant in 2013. Despite the decline in sales anticipated for 2015,
Brazil is expected to return to growth in 2016 and remains the fourth-largest
single market.
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