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Toyota invests big in Brazil

A US$2.2 billion pledge from the Japanese automaker marks the latest – and largest – investment this year in Latin America’s biggest car market.

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Japanese auto giant Toyota has confirmed its plan to invest US$2.2 billion in Brazil by 2030.

Nearly half of that sum will be invested by 2026, funding the expansion of factories in Porto Feliz and Sorocaba that are expected to generate 2,000 new jobs. 

Toyota intends to build a new hybrid flex vehicle by 2025, as well as a car designed for the Brazilian market Details on the second phase of investment have not been released.

The popularity of flex-fuel cars in Brazil has grown considerably in recent decades, as domestically produced sugarcane ethanol provides an energy-efficient, inexpensive supplement to gasoline with a fraction of the greenhouse impact. Hybrid flex vehicles incorporate an electric motor alongside the flex fuel engine, allowing for a smoother transition as EV infrastructure is built.

[See more: BYD launches an electric car entirely manufactured in Brazil]

Brazil is the largest car market in all of Latin America and a hub for vehicle exports to a region that includes 33 countries and more than 668 million people. International automakers have taken note.

Hyundai, General Motors and Volkswagen have all unveiled their own plans to boost investment in Brazil this year, pledging to spend between US$1.1 billion and US$1.8 billion by 2028. Like Toyota, their Brazilian factories are primarily in the southern state of São Paulo, long considered the heart of the country’s auto industry.

Toyota’s planned expansions will have the factory in Porto Feliz producing engines with hybrid systems by 2025, while the factory in Sorocaba will produce batteries from 2026. Under the plan, all operations at Indaiatuba will be transferred to Sorocaba. Toyota’s CEO in Brazil, Evandro Maggio, said that workers would have the option to migrate with operations; the two cities are an hour apart by car.

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