GM will build 2.8 diesel in-house, end contract with MWM International

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Automotive Business / August 5, 2015

General Motors has confirmed that it will end its engine manufacturing agreement next year with Navistar’s MWM International Motores diesel engine operation in Canoas, Brazil.

MWM International has been producing 2.8 liter Duramax diesel engines under license for GM which are used in the Latin American market S10 pickup and Trailblazer SUV, and now in the new U.S. market Chevrolet Colorado and GMC Canyon.

GM says the agreement will end in February 2016, at which time production will be transferred to one of GM’s own Brazilian plants.

GM originally awarded MWM International the 2.8 liter Duramax diesel engine contract in July 2008, with deliveries beginning in November 2011, coinciding with the arrival of the next generation GM global market pickup, and run to 2018.

At the time, MWM International president and CEO Waldey Sanchez said the company would invest US$80 million at its plants in Canoas (Rio Grande du Sul) and Santo Amaro,(São Paulo) in Brazil; and Jesus Maria in Argentina; and create 400 new jobs to meet the requirements of the GM contract.

From 1964 to 2008, International MWM produced almost 780,000 engines under contract for GM trucks, pickups and SUVs.

The new-for-2015 U.S. market Chevrolet Colorado and GMC Canyon is based on the new-for-2011 global market Chevrolet Colorado produced in Thailand and Brazil

GM produces 2.8-liter Duramax diesel engines for Thai production at its own engine plant in Thailand.

When the launch of the new Colorado (badged S-10) and Trailblazer in Brazil, the engine contract was hailed as the largest in the history of MWM International.

Engine volumes were expected to reach 60,000 units annually.

Neither company will comment on why the agreement will end two years early.

Currently, GM only produces flex-fuel ethanol engines in Brazil at two plants: São José dos Campos and Joinville. Production began in 2013.

The S-10 and Trailblazer are manufactured at GM’s San Jose plant.

Related reading:

http://www.chevrolet.com.br/

http://en.chevrolet.co.th/cars/trailblazer/model-overview.html

http://www.mwm.com.br/site.aspx/Home-En