BMW to build vehicles in Brazil from 2014 image

BMW Ag., the world’s largest luxury carmaker plans to build cars in the Brazilian state of Santa Catarina from 2014, Reuters reports.

An official decision by the company will be made shortly, Automobilwoche says, after it examined 26 locations for the plant including Sao Paulo. Wage costs and other favorable aspects played a decisive role in the choice of Santa Catarina, the article says.

Another source with knowledge of the situation said the plant would make three BMW models and another vehicle under the MINI brand.

Brazil’s auto industry saw sales climb 2.9% last year, less than the 4.2% growth expected by Fenabrave and the 5% growth forecast by auto maker association Anfavea, the daily O Estado de S. Paulo reported Tuesday, quoting industry sources.

O Estado said Italy’s Fiat remained the leading market brand in Brazil last year, selling 754,276 vehicles (22 percent), followed by Germany’s Volkswagen with 698,404 (20.4 percent), the US-based General Motors with 632,259 (18.4 percent), Ford with 314,016 (9.2 percent) and France’s Renault, with 194,294 (5.7 percent).

In terms of manufacturing, Brazil is the sixth-biggest vehicle producer in the world.