A Case of Regional Automotive Complementation in South America: The Development of a “High Tech” Plant for E.W. Transmissions

A multinational automotive company operating simultaneously in two bordering countries - Argentina and Brazil - interested both governments in a future common market based on interchange of parts and vehicles.

To attain this objective, a project for the installation of a “High Tech” manufacturing plant was developed and is being executed. This plant will source both countries with a modern and versatile E.W. transaxle, with the majority of components made at either one, plus some minor imports from Germany. Final assembly and delivery of finished product will be done in Argentina. The Company will benefit from per unit cost reduction derived from large scale production methods and reduction of import duty payments, and the possibility of having an entry in markets demanding high quality products, such as Europe. Both countries will benefit of the additional labor occupancy, added tax revenue due to increased local production, foreign currency income when exports to third countries are made, and latest state-of-the-art technology and operating methods and principles.