New modern plant will start production in Q4 2009

General Motors Brazil, along with officials from the Santa Catarina State and Joinville City, announced today the company's decision to build a new engine and automotive components plant in that city.

The new plant will require investments of approximately US$ 200 million and is scheduled to begin production in the 4^th quarter of 2009 -- only 19 months from the announcement. The plant will employ 500 people and is expected to generate 1,300 indirect jobs.

"The decision to build a new engine plant in Brazil is essential to our ability to expand vehicle production capacity throughout the Mercosul Region," said Jaime Ardila, President of General Motors Brazil and Mercosul.

José Carlos Pinheiro Neto, vice-president of GM Brazil, said, "The plant is part of GM Brazil's strategy to place facilities in the most advantageous locations and Joinville City provides a fantastic infrastructure and has highly skilled labor."

The facility will be approximately 500,000 square meters with the plant itself comprising an area of approximately 60,000 square meters. The plant will have the capability to produce 120,000 engines and 50,000 cylinder heads per year and, when at full capacity, it will operate on 3 shifts.

The plant will include some of the most advanced processes in the area of engine machining and assembly, and cylinder head manufacturing. The machining process incorporates flexible machines with control systems that provide for rapid production changes to volume, technical changes and product improvements. In addition, the sophisticated engine test system enables operators to test engines without using fuel (gasoline or ethanol). As a result, the electrically-powered system essentially eliminates the generation of contaminants inside the plant.

Adhemar Nicolini, General Director of GM Powertrain for Latin America, Africa and Middle East, said, "An example of environmental responsibility at the plant is the closed looped system that uses water and oil, but does not create industrial waste -- meaning there is zero pollution in the production process."

As with all GM facilities in Brazil, the new plant will be built in accordance with the company's global environmental policies. For example, approximately 180,000 square meters of land will be preserved as a natural habitat.