Chery Auto confirms to build new plant in Brazil

Shanghai, May 21 (Gasgoo.com) During this week's official visit of Brazilian President Luiz Inácio Lula da Silva to China, Chery Auto confirmed to the Brazilian delegation that it will establish a factory in Brazil, according to Brazilian news agency Agência Brasil.

The announcement confirms statements that the Chinese car company’s executives and its official importer/distributor in Brazil made during the 2009 Shanghai Auto Show in April.

Chery Auto is currently studying possible locations for the plant, which will have capacity to produce 150,000 vehicles per year. The JLJ Group, Chery's official importer/distributor in Brazil, announced that the plant will receive investments of about US$500 million and will operate in late 2011.

Meanwhile, Chery plans to begin sales of its vehicles in the Brazilian market next month, starting with the Tiggo small SUV. Chery assembles the model in Montevideo, Uruguay, which has a free trade agreement with Brazil. Three more models will arrive by the end of this year, all imported from China.

Chery Auto aims to sell about 2,500 units in Brazilian market and achieved 10,000 units in 2010. It will be the second Chinese brand to land in Brazil. The first is Hafei, which started selling small vehicles in Brazil in late 2008, working through local distributor Effa Motors.

Brazilian President Luiz Inacio Lula da Silva concluded his state visit to China yesterday. During his three-day visit, the two countries signed 13 agreements on cooperation in financing, loan, science, space, oil, law, port and agricultural products, among other sectors.