With a limited quota of just 3,000 full imports a year, plus the strict Inovar-Auto government auto policy rules to contend with, there are rumours locally that Volvo and its Chinese owner Geely are considering building a car manufacturing plant in Brazil.
The automaker keeps denying the possibility yet there might be no alternative for it to remain present in a market that, despite the recent downturn, remains among the four or five biggest in the world.
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One possibility is sharing an assembly line in Brazil, as VW and Audi already do. The Sino-Swedish group’s CMA architecture would enable assembly of multiple models on one line – as VW Group does with MQB platform-based cars – making the investment more profitable.
Geely, which currently imports the CG2 subcompact from Uruguay and the EC7 compact-medium from China, faces even more severe limitations than Volvo to compete here.
The state of Santa Catarina, where a BMW assembly plant and a GM powertrain factory are already established, is the likely choice of assembly plant location, according to local speculation.
