DETROIT—General Motors Co. plans to invest $2.65 billion in two of its Brazilian plants to build "several new products" over the next five years, the company said recetly.
The investment is expected to occur on a rolling basis for the unidentified vehicles, which will launch from 2020 through 2024 and be sold in South America.
The significant investment will help GM "build a sustainable business in Brazil leveraging the Chevrolet brand," according to an emailed statement from GM spokesman Dan Flores. He declined to elaborate on how many products the investment will support.
The announcement follows company executives earlier this year confirming that GM was evaluating options with government officials, unions and suppliers to make the auto maker more cost-effective in the region.
The support of such "key stakeholders," according to Flores, was "fundamental to make the business viable from a cost perspective, to protect jobs and to allow proper return" to GM shareholders.
GM, he said, will continue to evaluate further actions to address headwinds in the region such as material, labor and logistics costs, infrastructure, taxes and high cost of capital.
"We need to face these issues to build a competitive manufacturing basis in Brazil and the region, to be able to have a sustainable business," Flores said.
GM, for several years, has been restructuring its operations in South America, where the auto maker leads in market share.
In February, Dhivya Suryadevara, GM's chief financial officer, said the company had reduced its break-even point by 40 percent since 2012.
GM, she said, was working with dealers, suppliers, government officials and labor unions to "create a business plan that's going to weather these economic circumstances better."
She noted foreign exchange rate—particularly for Brazilian and Argentinian currencies—as a continuing headwind.