China's JAC to build factory in Brazil


In a recent statement, the Chinese automaker JAC Motors (Jianghuai Automobile Co.) said it will invest $500 million in its first factory in Brazil.

The factory will be built in the northeastern Brazilian state of Bahia, slated to open in 2014 and will have the capacity to produce 100.000 units per year. A total of 3.500 jobs are expected to be created.

In September, the Brazilian government decided to raise taxes on imported vehicles not built with at least 65% of the parts made in Brazil or coming from Mercosur countries.

The move was aimed at blocking a flood of Asian imports into Brazil. It means JAC will have to pay higher taxes until its Brazilian factory is operational.

Sergio Habib, president of JAC Brazil operations, said he hoped Brasilia would reconsider the higher taxes now that JAC investment plans are confirmed.

In related news, Hyundai is already building an assembly plant in Brazil, Nissan and Honda also announced investments into this country.

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