Navistar International’s Brazilian subsidiary has begun assembling medium- and heavy-duty trucks that were formerly built by a contract manufacturer.

International Industria Automotiva da America do Sul Ldta. began production at the Navistar Industrial Complex in Canoas, Rio Grande Do Sul, Brazil. The new truck manufacturing line will have capacity for 5,000 trucks per year and potential for added expansion as demand grows.

The plant will produce DuraStar conventional-cab trucks and the 9800 cab-over-engine model, which is still used in South America and elsewhere.

The 430,000 square-foot facility already serves as a parts distribution center and produces diesel engines for MWM-International. MWM is a leading manufacturer of diesel engines from 2.8 to 13 liters for Latin America and other markets for vehicle, agricultural, industrial and marine applications, a Navistar announcement said.

“We’re seeing great success in Brazil with our MWM engine business and we remain committed to the future in Brazil as we begin our truck manufacturing operations in Canoas,” said Eric Tech, president, Navistar Global Truck and Engine.

“Our business in Brazil has served as a great model for our global growth efforts,” he said. “Our ongoing investment in the Brazilian truck market—one of the largest commercial truck markets in the world—is a logical next step in our strategy.”

During the last three years, Navistar has invested more than US$200 million in Brazil on several strategic initiatives, including manufacturing operations, research and development, an emissions change from EURO-III to EURO-V standards, and new product launches for the Brazilian truck market.

By using the existing facility in Canoas, Navistar was able to avoid a significant investment required by an all-new “greenfield” project.

“Our Brazilian business is having a strong year and their success is an important part of the great progress we’re making in our company’s turnaround strategy,” Tech added. “While we remain focused on improving our core North American business, we continue to look for smart, strategic ways to invest in select global markets and our investment in Brazil is just one example of that approach.”