Today, Ford pulls out of Brazil in a move affecting thousands of workers in the auto industry. Brazil’s stock market volume rivaling GDP for the first time. Official 2020 inflation figures to be announced today.
Ford exit highlights Brazil’s auto industry woes
The Ford Motor Company announced the closure of its three plants in Brazil this year, after the pandemic “amplified a persistent idle capacity and underperforming sales, resulting in years of significant losses.” Factories in the states of Bahia and São Paulo will be immediately shut down, with a third in Ceará following suit by Q4 2021.
Behind the decision. Car sales dropped 26 percent in Brazil last year and are not set to return to pre-pandemic levels for another two years. In the state of Bahia, Ford paid roughly BRL 200 million (USD 36.4 million) in taxes back in 2019 — an amount that was halved in 2020.
- The writing was on the wall after Ford had closed another São Paulo-based plant early in 2019. Moreover, it had not launched a new investments program for the country since 2015, when the last plan expired.
- The move affects 5,000 workers and will disrupt a production chain that employs...