GM to invest $1B [of your money] in Brazil

Gazeta Mercantil (double translation via El Nuevo Dia) ^ | 11/18/2008

GM to invest $1B [of your money] in Brazil

Sao Paulo – General Motors Brazil wants to invest $1 billion in the country to avoid the same problems that plague its parent company in the United States because of the financial crisis, according to press reports [in South America].

According to Jaime Ardila, president of GM Brasil-Mercosur, the resources will come with the financial bailout package that the manufacturer will receive from the United States government, and will be used to “complete the renovation of the product line until 2012”.

“It would be illogical to remove investments where there is growth and our goal is to protect the investments in emerging markets”, he said in a statement published in the financial daily “Gazeta Mercantil”.

Ardila added that GM Brazil “will wait for the market’s behavior to know what decisions to make” in regard to employee layoffs, a policy adopted in other countries by the company.

To Ardila, the 8 billion “reales” ($3.5B US) boost for the Brazilian automotive sector announced recently by the [Brazil] federal government and the State of Sao Paulo, “has already improved sales”, which had declined by 12% in October.

The executive hinted that the company will operate in 2009 in a “conservative” scenario, with a forecast of 2.6 million units produced, at worst, and 2.9 million units, in a best case scenario.

Sales this year will reach 2.85 million vehicles, which represents a 15% improvement over last year.