Mercedes-Benz will spend about EUR622m boosting truck, bus and component production capacity at its São Bernardo do Campo plant in Brazil from 2009 to 2011, the company said on Tuesday.
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The investment will also be used to modernise production processes, improve logistics and increase local content.
Mercedes-Benz do Brasil is the biggest manufacturer of commercial vehicles in Latin America having sold 22,778 units during the first seven months of the year, for market share of 31%. The company was also market leader in 2007, with 31,166 units sold and 31% market share.
An as yet undecided number of new jobs will be created at São Bernardo do Campo, which currently employs about 12,000 workers.
“The plant is currently running at nearly full capacity, which means that further sales growth can only be accommodated by eliminating production bottlenecks or expanding manufacturing operations,” Mercedes said.
Daily output will be increased by 25% from the beginning of 2009.
“Today’s announcement clearly reaffirms our commitment to Brazil”, said Mercedes-Benz do Brasil chief Gero Herrmann.
The new investment is intended to ensure the plant’s competitiveness for the next decade, and to improve its flexibility so product mix can be more quickly changed to suit market conditions.
“To [achieve] all these aims, the company will invest R$1.5bn (EUR622m) during the next three years”, said Herrmann.
Mercedes-Benz do Brasil is also the leader in the bus segment. From January to July of this year it sold 9,211 units for a 50% share. 2007 sales of 12,600 units gave it a a 52% share.
It is also the biggest exporter of commercial vehicles in Latin America, exporting to over 50 countries. Major markets include Argentina, Chile, Peru, Egypt, Nigeria, South Africa, and Jordan. Last year, the company exported around 9,700 trucks and 9,400 buses to external markets.
São Bernardo do Campo has produced trucks and buses since opening in 1956 and has built over 1.6m vehicles.
