General Motors says it is to invest more than $1bn (£608m) to develop two new car models in Brazil despite woes at the company’s US headquarters.
GM says the planned investment should create about 1,000 jobs.
A government tax break which cut the cost of new vehicles in Brazil, led to GM seeing record sales in the country.
The expansion comes as GM emerges from bankruptcy proceedings as a private company which is majority owned by the US government.
However, GM in Brazil is financially independent of the US company – and it has been keen to stress that there will be no dependence on products from the United States.
Half of the investment will come from the company itself and the rest from loans from state-run banks, says the BBC’s Gary Duffy in Sao Paulo.
Brazilian motorists bought more new cars in June than ever before, making the country one of the few bright spots for the industry worldwide.
“Car manufacturers here are even suggesting 2009 could be their best year in history but they may have to work harder to maintain that outlook when the government eventually removes its tax break which it has now extended on two occasions,” our correspondent said.
Source: BBC News