Chinese state group Shaanxi Automobile Group (SAG) plans to manufacture Shacman brand trucks in the Brazilian state of Pernambuco as of 2013, according to a statement from the State’s government cited by the Brazilian press.
The governor of the state, Eduardo Campos, visited a Shaanxi Automobile Group factory in China, where he closed the deal on an investment of 1 billion reals (US$494 million), according to information from the state government.
Construction of the factory is expected to begin this year, and the group expects to have initial production of 10,000 vehicles per year, which will double by 2017.
The SAG group currently manufactures around 200,000 trucks and buses per year, which are sold on five continents.
The factory will be built in Caruaru, on an area of 220 hectares and will be part of a future automotive industry complex developed by the government to manufacture trucks and buses.
The heavy and extra heavy goods vehicles manufactured at the factory will be distributed to the whole of South America according to the Pernambuco government statement.
Under the terms of the contract, the Chinese group will receive tax incentives both from the state of Pernambuco and from the Caruaru council, such as building and property tax exemption for a period of ten years.
The Shacman brand, which already has a distribution centre in the port of Recife, is the result of a technological partnership between SAG and MAN, of the Volkswagen group. (macauhub)