Brazil's Trade Minister Fernando Pimentel said Monday that Jaguar Land Rover, the U.K.-based unit of Tata Motors Ltd. (TTM), plans to build a factory in the Latin American country, Estado news agency reported.
Pimentel said that the car maker already has a construction project prepared, but has yet to pick a location for the new factory, Estado said, citing the minister after a meeting with U.K. authorities.
The new factory, the company's first outside the U.K., is a response to higher taxes on imported cars that Brazil enacted in September and which go into effect mid-December. The government raised taxes by 30 percentage points on cars with less than 65% locally produced components in order to slow the flow of imports that have flooded the country.
A new set of rules governing the automotive industry are likely to make permanent the higher tax on cars without a stipulated proportion of locally produced parts, but new carmakers such as Land Rover are likely to have time to ramp up production to meet that.
Pimentel said Monday that Land Rover will have such a transition period, without giving detail about the new auto policy, Estado reported. The new policy is expected to go into effect when the current tax hike expires at the end of 2012.
The ministry's press office in Brasilia didn't return Dow Jones Newswire calls seeking comment. Land Rover's press offices in Sao Paulo and in London also didn't immediately return calls.
Source: Fox Business
Pimentel said that the car maker already has a construction project prepared, but has yet to pick a location for the new factory, Estado said, citing the minister after a meeting with U.K. authorities.
The new factory, the company's first outside the U.K., is a response to higher taxes on imported cars that Brazil enacted in September and which go into effect mid-December. The government raised taxes by 30 percentage points on cars with less than 65% locally produced components in order to slow the flow of imports that have flooded the country.
A new set of rules governing the automotive industry are likely to make permanent the higher tax on cars without a stipulated proportion of locally produced parts, but new carmakers such as Land Rover are likely to have time to ramp up production to meet that.
Pimentel said Monday that Land Rover will have such a transition period, without giving detail about the new auto policy, Estado reported. The new policy is expected to go into effect when the current tax hike expires at the end of 2012.
The ministry's press office in Brasilia didn't return Dow Jones Newswire calls seeking comment. Land Rover's press offices in Sao Paulo and in London also didn't immediately return calls.
Source: Fox Business
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