Ford Motor Co. (F) plans to invest 800 million real ($446 million) for building a new car at its Sao Bernardo do Campo plant in Brazil near Sao Paulo. The automaker is likely to sell the car globally.
However, Ford has not provided any details of the new model.
Presently, the Sao Bernardo plant produces Ka, Courier and F-250 models. It has an annual production capacity of 160,000 light vehicles and 40,000 trucks.
Ford has been pursuing a major expansion plan in the emerging countries, including Argentina, Brazil, China, India and Thailand. Through the expansion plan, the automaker aims to tap the growing market in these countries, especially those in Asia.
Nissan Motor Co. (NSANY) is also pursuing a plan to expand its market share in Brazil. Recently, the Japanese auto maker disclosed its plan to invest $1.5 billion for building a plant in Resende, near Rio de Janeiro.
In the first 10 months of the year, vehicle sales in Brazil rose 5.1% to more than 3 million units. Expanding credit and falling interest rate are expected to boost sales in the country to more than the 3.5 million vehicles for full year 2011.
Ford, a Zacks #4 Rank (Sell) stock, posted a $66 million or 3.5% fall in profits to $1.85 billion in the third quarter of the year from $1.91 billion in the same quarter of prior year. However, on per share basis, earnings were 46 cents versus 48 cents a year ago, beating the Zacks Consensus Estimate of 44 cents. The decline in profits was attributable to a fall in commodity prices and anticipated reductions in Financial Services results.
Total revenues in the quarter went up $4.1 billion or 14.1% to $33.1 billion. This compared with the Zacks Consensus Estimate of $29.8 billion.
Ford generated $3.0 billion of revenues in South America, up 20% from the prior year. Pre-tax operating profit in the region was $276 million compared with $241 million a year ago. The increase in profit was attributable to favorable net pricing, volume and mix, and other profits, offset partially by higher structural costs.
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