GM raises Brazil investment by BRL 3.5 billion and criticizes import quota benefits favoring BYD

General Motors announced on Wednesday (June 24) an additional investment of BRL 3.5 billion in its Brazilian operations, raising its total investment plan for the 2024–2028 period to BRL 10.5 billion.

The announcement was delivered in person to Brazil’s Vice President, Geraldo Alckmin, by Fabio Rua, Vice President of GM South America.

The increase represents a 50% expansion over the automaker’s original BRL 7 billion commitment announced two years ago. It comes just one day after the Brazilian government decided to renew import quotas for CKD (completely knocked down) and SKD (semi-knocked down) vehicle kits—a measure strongly supported by Chinese automaker BYD but criticized by traditional manufacturers operating in Brazil, including GM.

Speaking to Folha de S.Paulo, Rua criticized the government’s decision and said GM is fully aligned with the position of Anfavea (Brazil’s National Association of Motor Vehicle Manufacturers), which had advocated ending the quotas.

“We respect the government’s decision, but our position is 100% aligned with Anfavea’s,” Rua said. “We do not believe the Brazilian automotive industry will be strengthened through unilateral measures designed to benefit a single competitor. It was an uncomfortable decision, I can’t deny that.”

According to the executive, the risk is that Brazil could encourage assembly operations with limited local content instead of supporting manufacturers that maintain fully integrated production chains in the country.

“We need to prevent new rounds of unilateral requests for quota access from succeeding for companies that do not manufacture with the same depth of local production that we do,” he added.

On Tuesday (June 23), the Executive Management Committee of Brazil’s Foreign Trade Chamber (Gecex), part of the Ministry of Development, Industry, Trade and Services (MDIC), decided to extend the quotas for another six months, allowing the import of electrified vehicle CKD and SKD kits without import duties.

Under the measure, up to US$463 million worth of imports will qualify for a zero import tariff. The exemption will take effect on July 1, 2026, and remain in force for six months.

Anfavea is considering legal action to challenge the decision, depending on the final wording of the regulation establishing the quota rules.

During the meeting with Alckmin, GM presented a formal proposal to replace recurring disputes over import quotas. According to Rua, the proposal is modeled after Mexico’s automotive policy, where tariff benefits for vehicle or component imports are linked to the volume of local production.

“The government should adopt a policy that encourages domestic production, whereby the higher the production volume, the greater the percentage of vehicles or components that can be imported under preferential tariff conditions,” Rua said.

He added that the proposal was formally submitted to the vice president. “I found him very receptive. He even said it was an intelligent proposal.”

Rua said the additional investment will accelerate factory modernization and vehicle electrification initiatives. The company has already been implementing part of the investment plan since 2024.

According to Rua, roughly half of the total investment has already been allocated to new vehicle models and industrial modernization projects. These include the development of new vehicles at GM’s Gravataí plant in Rio Grande do Sul, updates to existing models, and increased automation of production lines.

Most of the new funding will be directed toward the company’s operations in São Paulo state, where GM operates manufacturing plants in São Caetano do Sul and São José dos Campos. The automaker did not disclose which new models will be launched or how many jobs will be created, but said new products are already under development and will be announced in the coming months.

Source: Folha de S.Paulo

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