Audi mulls fresh go at car production in Brazil | Business| Economy and finance news from a German perspective | DW | 22.03.2013
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Audi mulls fresh go at car production in Brazil

German carmaker Audi has said it's contemplating having another shot at car production in Brazil after stopping its T3 operations some years ago. It could draw from the experience of its parent company, VW.

German carmaker Audi said it was considering an option to resume car production in Brazil. "A decision has not yet been reached, but we're in the process of looking into it and will come to a conclusion within the next six months," the head of Volkswagen's Latin America operations, Michael Macht, said in Sao Paulo.

As Audi's parent company VW marks six decades of its presence in Brazil, the Latin American country looks attractive to many auto makers, such as BMW which announced last year it was planning to launch a production facility in the world's sixth-largest economy in 2014.

For Audi, it would be a second attempt to put down roots in Brazil after it ended its T3 production in the country in 2006 for profitability reasons. A mere complete knock down facility (CKD production) would not be a lucrative option for the Ingolstadt-based German luxury carmaker though because of high import duties.

Investment offensive

Like many rival auto makers, Audi is increasingly looking to countries outside the European Union, with the bloc continuing to be in the grip of a protracted debt crisis. The company had announced earlier it was also building plants in Russia and Mexico and may expand operations in Hungary and China. But it noted Brazil would definitely be "a very interesting market."

Twelve-brand parent company Volkswagen said it was highly pleased with business operations in Brazil, pointing out that the firm had a 21-percent market share in Brazil, second only to Fiat.

VW announced it would invest 3.4 billion euros ($4.4 billion) in Brazil by 2016, with available resources to go into both production and infrastructure.

hg/jlw (dpa, Reuters)