Daimler is said to be considering investing in a new plant in Brazil to help avoid import taxes in the country, reports Reuters citing an article in Der Spiegel. According to the German magazine, the company is planning to assemble its C-Class model at a site intended to be completed in 2015. It added that its initial capacity has been pegged at 20,000 units per annum (upa), without naming its source, and that it will decide on the plant during the coming months. However, a spokesperson for the automaker told the news service, "We are looking at Brazil, just like various other locations."
Significance: This would be Daimler's second foray in passenger car production in Brazil, having built the A-Class and C-Class Sport Coupé between 1999 and 2010 in Juiz de Fora. It was not an overwhelming success, and this site was repurposed for the production of commercial vehicles. However, with the market now larger than ever before, Daimler is again exploring the possibility, incentivised by import taxes. It is also likely to be eyeing BMW's decision to build vehicles in Brazil, announced last year, while Audi is also known to be considering local production. With demand for the C-Class having wilted locally on the back of the new taxes, it would certainly make sense, as well as helping it to make further headway going forward.
