Fiat has not revealed its product plan for the new plant at the Suape industrial and port complex in the Greater Recife region, close to the Pernambuco state capital, but a replacement for the long-running Uno Mille is most likely.
The contract will be signed on 29 December. Already suppliers are making full use of the taxation and grant incentives available in the largest port in the northeast region port. Moura Batteries and South Cone Steel Works have made plans already.
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It is most likely the new model for the new plant will replace the Mille, the oldest car produced in the country without major changes. True, the VW Gol was launched earlier, in 1980, but the current generation has inherited nothing but the nameplate.
Manufactured since 1984 in Betim (Minas Gerais), the Mille is the most affordable automobile offered locally. Even Chinese models like the Effa (Change) M100 are finding it hard to compete in price, even though they are better equipped.
New Brazilian safety standards taking effect in 2014 will finally prompt Fiat to axe the Mille which could be adapted but at an unrealistic cost.
The trick was to establish a new plant paying lower wages, and using new production techniques amid an industrial complex of automaker and supplier park like Ford’s in Camaçari, Bahia and GM’s in Gravataí, Rio Grande do Sul. Generous location incentives also made the project feasible.
Among the Big Four in Brazil, the Italians were alone in not having a second auto manufacturing plant.
The Betim plant, opened in 1976, can build 3,300 units daily installed capacity and will be enlarged to nearly 4,000 a day (950,000 units per year).
In Suape, 200,000 vehicles yearly will be built as of 2014, with a lot of room to grow.
