Daimler plans to build a new plant in Brazil

Daimler plans to build a new plant in Brazil as rising taxes on foreign vehicles make it more difficult to sell imported cars in the country, a magazine reported.

Daimler's Mercedes-Benz will begin assembling C-class cars in Brazil by 2015, with a starting capacity of about 20,000 vehicles a year, German weekly Der Spiegel reported, without saying where it got the information.

A Daimler spokesman said the company was considering such a move but had made no decision yet. "We are looking at Brazil, just like various other locations," he said.

Luxury carmakers are flocking to Brazil in an attempt to exploit growing demand. Brazil's government complicated their plans, though, with a drive to protect local jobs by increasing a tax on foreign-made cars last year.

BMW announced plans for a new assembly plant in Brazil last October and Audi will decide next year whether to start building cars in Brazil.

Setting up a new plant in Brazil would not be Daimler's first foray into the world's fourth-biggest auto market.

From 1999 until December 2010, Daimler built the Mercedes A class in its Juiz de Fora plant, making it the first luxury carmaker to produce vehicles in Brazil.

The automaker ceased car production at the plant in 2010 and refitted the site to make commercial trucks.

Der Spiegel said on Sunday that Daimler would decide in the coming months where in Brazil to build the new plant.



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