GM Chairman and Chief Executive Officer Rick Wagoner said the move will lead to the introduction of a new family of low-cost small vehicles.
"We have been growing our engineering resources in key emerging markets like Brazil, China and India -- not only for development of vehicles for their own markets, but for other emerging markets as well," Wagoner said in a statement.
GM officials said the investment will include $400 million worth of upgrades at the company's Sao Caetano do Sul, Brazil, and Rosario, Argentina, production plants. About $100 million will be used to upgrade the company's Brazilian product development center.
Wagoner said the investment will lead to production of a new family of vehicles for a Latin American division where sales already are strong. Production of the new small vehicle line, which GM officials declined to describe, is expected to begin by early 2010.
Through the first two quarters of 2007, GM sales in Brazil were up 18 percent compared with the same period in 2006, while Argentina sales were up 16 percent.
GM Argentina sold 75,000 units in 2006. GM Brazil sold 410,000 units. Both were all-time records.
