Grupo SHC will now assemble JAC T5 crossover instead of J3 compact sedan and hatchback as previously planned. CKD plant capacity has been slashed from 100,000 to 20,000 a year from 2017.
Following a re-think after the market overall slump, Chinese automaker JAC's representative in Brazil, Grupo SHC, has decided to go it alone and set up a 20,000-unit CKD kit assembly line.
This will be at the same Camaçari site in the north-eastern state of Bahia, where a cornerstone ceremony in November 2012 was followed by the burial of a JAC J3 in a 'time capsule' to be dug up in 2032.
However, over the last three years, the introduction of the Inovar-Auto local content programme and sinking sales have led SHC to change plans.
Initially, JAC's Chinese parent owned 66% of the company formed to build and operate the planned, 100,000-unit US$500m plant (close to Ford's).
Now, investment will be significantly lower at $54mi/BRL200mi), or 80% less than originally planned, and sized for 20,000 units a year. CKD assembly is expected to start in 2017.
Previously planned Brazilian production of the J3 compact has now been switched to the T5 crossover (currently imported assembled from China) just launched here. The move aligns with the success of crossovers and compact SUVs in Brazil due to consumer preference.