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The Italian automaker Fiat will invest 100 million U.S. dollars in Argentina to produce agriculture machinery, the Argentine Industry Ministry and Fiat said on Tuesday.
Through its local subsidiary Case New Holland (CNH) Fiat will start the local production and assembly of a small tractor, large capacity harvesters and the Fiat Powertrain Technologies (FPT) engines needed for these agricultural machinery.
"Eighty percent of the investment will be used to produce tractors and harvesters, which at the beginning will be assembled and within 12 months its spare parts and pieces will be nationalized. Half of the machines made will supply the local market and the rest will be exported to Brazil and other South American countries," the Ministry said in a statement.
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According to the statement, this investment "will allow the generation of 600 direct jobs and 1,500 indirect jobs, and which will add to other projects of companies in the sector which are worth 100 million dollars," Industry Minister Debora Giorgi said.
"This news is a direct response to our demand by the producers of agricultural machinery which will duplicate their output in 2011," Giorgi said.
Meanwhile, Sergio Marchionne, president for Fiat Industrial, said that Argentina "will become a center of excellence for the production in Latin America in this line of products. This investment is key for our development strategy in the region."
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The new plant, which will occupy a total area of 78,000 square meters, will be based in the central Argentine province of Cordoba.
In the period 2002-2010 the export of agricultural machinery increased nine times, reaching sales worth 169.5 million U.S. dollars in 2010, according to the Industry Ministry.
The main destinations for these Argentine exports include Venezuela, Uruguay, Brazil, Bolivia, Chile, Paraguay, United States, Australia, Mexico, Peru and Russia.
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Source: Xinhuanet