Ford to Build Factory in Brazil’s Bahia State

Ford Motor Co. said it will build a $1.3-billion car plant in Brazil’s northeastern Bahia state, nearly two months after it scrapped plans to build it in a leftist-ruled state in a dispute over subsidies. The auto maker said it will invest $780 million in the plant, which will start operation by the end of 2001. It said auto parts suppliers such as Akron, Ohio-based Goodyear Tire & Rubber Co. and Germany’s Siemens will provide the rest of the money for the project. Ford said Bahia, a conservative state that is home to influential Congress President Antonio Carlos Magalhaes, will also guarantee the financial support Ford needs and which it failed to get in Rio Grande do Sul, Brazil’s southernmost state, where General Motors Corp. is building a major compact-car plant. Bahia did not specify the incentives it is providing for Ford but said it has been negotiating with the company on possible tax breaks since soon after talks with Rio Grande do Sul broke down. Ford said the new plant will build 250,000 cars a year and employ 5,000 people in Bahia.

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