[Peace-discuss] GM to use bailout cash to move to Brazil?

[E. Wayne Johnson]

http://www.laht.com/article.asp?ArticleId=320909&CategoryId=12396 
<http://www.laht.com/article.asp?ArticleId=320909&CategoryId=12396>

General Motors to Invest $1 Billion in Brazil Operations -- Money to 
Come from U.S. Rescue Program

By Russ Dallen
Latin American Herald Tribune staff

General Motors plans to invest $1 billion in Brazil to avoid the kind of 
problems the U.S. automaker is facing in its home market, said the 
beleaguered car maker.

According to the president of GM Brazil-Mercosur, Jaime Ardila, the 
funding will come from the package of financial aid that the 
manufacturer will receive from the U.S. government and will be used to 
"complete the renovation of the line of products up to 2012."

"It wouldn't be logical to withdraw the investment from where we're 
growing, and our goal is to protect investments in emerging markets," he 
said in a statement published by the business daily Gazeta Mercantil.

Meanwhile, he cut the company's revenue forecast for this year by 14% to 
$9.5 billion from $11 billion, as the economic crisis began to cause 
rapid slowdowns in sales.

GM already announced three programs of paid leave, and Ardila added that 
GM Brazil "is going to wait and see how the market behaves in order to 
know what decision to take" with regard to possible layoffs.

For Ardila, the injection in Brazil's automobile sector of 8 billion 
reais ($3.51 billion) recently announced by the federal and state 
governments of Sao Paulo "has already begun to revive sales," which fell 
by 12% in October.

The executive said that the company will operate a "conservative" 
scenario in 2009 with an estimated production of 2.6 million units, and 
another more "optimistic" that contemplates sales of 2.9 million.

This year sales will reach 2.85 million vehicles, which represents a 
growth of 15% over last year.

Russ Dallen with EFE in Sao Paulo