After Brazil decided to scale back imports from Mexican factories, Nissan said it plans to accelerate expansion there.

According to Business Week, Nissan president Carlos Ghosn said the deal between the two Latin American countries means: "The ramp-up of the Brazilian plant has to be even more faster than what we are envisioning. This limitation of exports from Mexico to Brazil makes our Brazilian plant even more necessary."

The company is planning to invest BRL2.6bn (US$1.4bn) to boost annual capacity fourfold by 2014 after Mexico said it would cut back exports to Brazil by as much as 30% for the next three years. Nissan has plants in Mexico shipping cars to Brazil and also has a Brazilian assembly plant.

"It's positive for Nissan to speed up its expansion in Brazil," said Takashi Aoki, senior fund manager at Mizuho Asset Management in Tokyo. "It indicates Nissan is exercising good foresight."

Nissan plans to start operations at an assembly plant in Rio de Janeiro in 2014 to add an additional 200,000 vehicles to its annual capacity.

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