Stellantis to Invest $6 Billion in Brazil by 2030

Stellantis logo is seen on the company's headquarters in Poissy near Paris, France, February 20, 2022. REUTERS/Gonzalo Fuentes/File Photo Purchase Licensing Rights

The investment, announced shortly after a meeting between company executives and President Luiz Inacio Lula da Silva, comes as the government tries to reignite the country's industry.

Other automakers, such as GM (GM.N), opens new tab, Volkswagen (VOWG_p.DE), opens new tab, Hyundai (005380.KS), opens new tab, and Toyota (7203.T), opens new tab had already announced investments in the country.

Among Stellantis' plans for Latin America's largest economy is adding electrification technology to its flex-fuel models, which run both on gasoline and ethanol, Chief Executive Carlos Tavares said in a press conference.

The company's next launch is scheduled for the second half of the year and will be a hybrid vehicle, he said.

Stellantis, which owns brands such as Fiat, Peugeot, Citroen, also said it plans to produce an electric vehicle in the country, though it did not give a timeline.

Tavares said the investment plan will follow Brazil's Mover automotive program rules, which is set to give tax breaks to automakers that invest in sustainability and establish new obligations to reduce the industry's environmental impact.

"It's a pragmatic and clever program", he said. "This alignment of interests between Brazil's government and our company is essential".

Stellantis, which owns three factories in the country, announced last month it was buying a controlling stake in Brazilian automotive services firm DPaschoal.

Brazil's government says automakers, including Chinese firms BYD (002594.SZ), opens new tab and GWM (601633.SS), opens new tab, which had recently arrived in the country, have already announced a total 65.3 billion reais in investments in the country for the next few years.