ArvinMeritor, Inc. (NYSE: ARM) announced it will invest approximately $10 million to build a new axle manufacturing operation in Resende, Brazil, to support MAN's production of trucks and buses in the region.
On April 15, Georg Pachta-Reyhofen, president and CEO of MAN, announced investments of approximately $50 million to establish a supplier park in the industrial complex where the brand produces trucks. Approximately 700 new jobs will be created to support the expansion backed by components and systems suppliers ArvinMeritor, Suspensys and Maxion.
Silvio Barros, director of Marketing and Sales for ArvinMeritor in South America, said the company's investment in the supplier park is part of its strategy to support MAN's growth globally.
"This initiative is aligned with our objectives to reinforce the ArvinMeritor brand as a strong player in the global commercial vehicle markets," said Barros.
The supplier consortium in Resende, near Rio de Janeiro, will be operational in 2011, one year before MAN launches TGS/X trucks to the Brazilian market. Trucks will be initially assembled from SKD kits imported from Germany with the medium-term objective of 60 percent local content.
The MAN factory in Resende assembles trucks and buses with the support of an association of suppliers that provide complete components and systems from factories located in other parts of the country. ArvinMeritor and Maxion currently participate in this modular consortium inside the MAN factory. Axles and components supplied by ArvinMeritor are now produced in Osasco, 12 miles from Sao Paulo, and dispatched to Resende.
Starting in 2012, the new ArvinMeritor warehouse and factory will produce axles locally for MAN and VW with components received from its manufacturing facility in Osasco, Brazil.