Mazda, already building a new plant in Mexico, could start assembling vehicles in Brazil to sidestep import restrictions due from 2015.

"We are in talks with several Brazilian automakers on possible local knockdown production [kit assembly]," Takashi Yamanouchi, Mazda chairman, told reporters at the Los Angeles show this week.

Mazda had originally planned to use the 140,000-capacity Mexico plant, due on stream in 2014, to export to both North and Latin America. Mexico has a free trade agreement with Brazil. The plant will also build a small car based on the Mazda2 for Toyota which will be sold in North America.

The Brazilian government’s decision to restrict imports of finished vehicles is designed to protect the domestic industry. Car sales in Brazil are forecast to reach some 4m units this year.

Elsewhere in South America, Mazdas are assembled in Colombia.