CAOA signs agreement with Ford over Brazilian plant purchase

Brazilian automaker CAOA has signed a confidentiality agreement to negotiate a possible purchase of Ford Motor’s plant in the industrial city of Sao Bernardo do Campo, as per a source knowledgeable about the matter.

Ford in February declared it would shut down the plant, its oldest one in the nation, amid a global restructuring plan, costing 3,000 jobs.

The announcement triggered a campaign led by Sao Paulo governor Joao Doria to discover a buyer for the space.

Reuters reported CAOA’s interest in the factory in last month, but at the time there were up to three different firms that were taking interest in the plant.

Ford refused to discuss on the confidentiality agreement or whether CAOA had been the one to sign it. CAOA did not immediately answered to a request for comment.

Negotiations are not final, but it is an indication that the two companies are close to a deal, the source stated.

CAOA has a strong bonding with Ford as its single largest distributor in the country.

Brazil has long been South America’s automaking hub and has led many brand name worldwide automakers to set up shop here. But CAOA is the rare company that is actually regionally owned. It presently produces cars for Hyundai and owns a 50 percent stake in China’s Chery operation in Brazil, which led to the rebranding of the vehicles as CAOA Chery.