Brazil has hit a wall regarding its automotive sector and continued growth. The country was once one of the world’s five largest automotive markets, but recession and political happenings have led to a 29.3-percent decrease in automotive production, the lowest since 2003, and has left nearly one-third of the country’s 133,000 workers in limbo.
Considering all of the information above, it comes as little surprise General Motors may nix its $1.6 billion investment into the country for increased production, new product and technology. Automotive News reports GM President Dan Ammann made the comments during an interview this past Sunday.
“I hope to see political and economic advances in the next six to 12 months, which would allow us to stick to our investment plan,” Ammann told the Estado de S.Paulo newspaper.
GM President South America also reiterated Ammann’s comments, stating major changes in fiscal policy and reforms to its tax, labor and regulatory laws need to be made because, currently, the country is “terribly uncompetitive.”
GM still views Brazil as an important market for the future, but again reiterated a “big change” needs to occur to cement its potential.
“The important question is to know when we will see the stability that allows us to continue investing. We are worried because the environment is unstable and the outlook is uncertain for the next few years,” he said.