Mercedes Reportedly Planning to Build Next C-Class in Brazil from 2015

Daimler AG, the parent company of Mercedes-Benz, is reportedly planning to set up a new plant in Brazil, South America’s largest car market. According to a report from Reuters that cites the print edition of German magazine Der Spiegel, Brazil’s rising taxes on foreign vehicles make it hard for overseas automakers to sell their imported cars in the South American country.

The German report, which does not mention any sources, says the plant will build next generation Mercedes-Benz C-Class vehicles by 2015, with initial capacity estimated at 20,000 vehicles per year. A Daimler spokesman said the company is considering such a move but hasn’t made any decisions yet. “We are looking at Brazil, just like various other locations,” he said.

Luxury car manufacturers are setting up production facilities in the country in order to ride the wave of growing car demand in the world’s fourth-largest car market and to avoid the country’s increased taxes on foreign-made cars. In October 2012, BMW announced plans for a new assembly plant in Brazil, with Audi to make a decision next year whether to start making cars there.

Daimler has been manufacturing the Mercedes-Benz A-Class in Brazil at the Juiz de Fora plant since 1999, making it the first luxury carmaker to assemble vehicles there. However, car production at Juiz de Fora ended in December 2010, as the plant has been retooled to manufacture commercial trucks.

According to the report, the location of the new plant will be decided in the coming months.

By Dan Mihalascu

PHOTO GALLERY