BRAZIL/SOUTH AMERICA REPORT
In the past three months, the aggregate investments announced by automotive manufacturers in Brazil have reached a total of US$ 14.3 billion. The largest individual investment came from Stellantis, committing US$ 6 billion to the country between 2025 and 2030, marking a record sum among major vehicle manufacturers operating within the nation. A significant portion of this investment will be directed towards the development of flex-hybrid models.
This investment influx began in December, with Renault earmarking US$ 500 million for the production of a new SUV in Paraná, featuring engine variants that blend ethanol, gasoline, and electricity. In January this year, General Motors (GM) unveiled investments totaling US$ 1.4 billion aimed at product rejuvenation.
Subsequently, in February, Volkswagen augmented its previously announced investment plan by US$ 1.8 billion, extending the total commitment to $3.2 billion spanning from 2022 to 2028. In the ensuing period, Hyundai announced an investment of $1 billion, while Toyota declared an allocation of $2.2 billion.
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PSR Analysis: Most of investment is related to production of hybrid vehicles in Brazil, made by traditional OEMs to compete with Chinese newcomers, BYD and GWM, which are installing plants in Brazil to build hybrid and electric vehicles. The investment will open several windows of opportunity to new suppliers who are expected to join the programs with new hybrid powertrain and plugin technologies for recharge.
Fabio Ferraresi is Director, Business Development-South America, for Power Systems Research
