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China’s Foton To Build Truck Plant In Brazil

Posted on August 19, 2013

A local subsidiary of Chinese truck manufacturer Beiqi Foton Motor Co. Ltd. has signed an agreement with the government of Rio Grande do Sul to build a new truck assembly facility near Porto Alegre, Brazil. The Foton Aumark do Brasil plant will be located in Guaíba and will assemble trucks from 3.5 to 24 tons. The vehicles will be Brazilian versions of the company’s premium Aumark and Aumam product ranges.

Construction of the facility may begin this year and the first trucks are scheduled to be assembled around the beginning of 2016. Until then, the company will continue to import 3.5 to 10 ton GVW trucks from its headquarters facility in Beijing. The initial investment in the Guaíba is R$250 million (US$108 million) and the plant will occupy a site of 1.5 million m2, one-third of which will be occupied by suppliers. The vehicles will have 15% local content in the beginning, which is expected to grow to 65% in three years, the company said.

With an installed production capacity 21,000 trucks a year per shift, Foton Aumark said the line will be expanded gradually to a target of 50 000 vehicles a year by 2018. The vehicles assembled there will be sold throughout the Mercosur region and in Africa.

“We are confident about our decision,” said Luiz Carlos Mendonça de Barros, Foton Aumark do Brasil’s president. “Rio Grande do Sul State has a vocation for the automotive sector and the conclusion of the negotiations with the governor and his staff shows me that this investment will bring many benefits for the state and for Brazil. I can assure that a lot is still to come from this enterprise.”

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