Brazil’s President Dilma Rousseff will meet with officials from Bayerische Motoren Werke AG (BMW) today following reports the German carmaker is preparing to invest in a new assembly plant.
BMW will build the factory in the southern state of Santa Catarina, the state government said in a statement posted on its website today. The company did not immediately respond to e-mails and telephone requests for comment from Bloomberg News.
The factory will require an investment of 1 billion reais ($493 million) and initially generate 1,500 jobs, the government said in the statement. BMW Sales Chief Ian Robertson will meet with Rousseff at 3 p.m. Brasilia time, according to the president’s agenda.
Rousseff’s administration on Oct. 4 announced tax breaks for carmakers that increase investments in Brazil in a bid to revive its shrinking manufacturing industry.
Finance Minister Guido Mantega has said that auto companies will invest $22 billion over the next three years in Brazil. Automakers will have to meet tougher environmental, safety and fuel efficiency standards in order to get additional tax breaks, he said on Oct.4.
In May, the government cut the IPI tax on cars, helping drive vehicle sales from this year’s low of 249,500 in February to a record high 420,100 in August, according to the national car dealership association. In September, car sales fell 31 percent from the previous month.
Editors: Harry Maurer, Philip Sanders
To contact the reporter on this story: Raymond Colitt in Brasilia at firstname.lastname@example.org.