Daimler has announced that its trucks division will invest EUR300m (USD414m) in Brazil over the next two years. The investment is said to involve investment in research and development of new products and innovative technologies and process optimisation and modernisation of its São Bernardo do Campo and Juiz de Fora plants. Financing is part of a previously announced investment project by Mercedes-Benz do Brazil funded with a budget of EUR750m (USD1bn) for a six-year span (2010 to 2015).
Significance: This investment follows three significant orders from Brazilian governments and regional authorities for Mercedes-Benz bus chassis, 2,884 dump trucks and a large order last November . Several issues are affecting this activity, including the Brazilian government getting ready to host major international sporting events (World Cup Soccer and the Olympics), as well as an aggressive tax structure that encourages not only production in Brazil, but also research and development investment. The tax structure in particular has resulted in a flurry of planned activity from several luxury makers as well as Honda. However, in this case for Mercedes-Benz do Brazil, this is an allocation of funds already earmarked for the region, not a newly introduced investment programme.
