General Motors Corp.'s Blue Macaw project — a blueprint for the automaker's Yellowstone program now on the backburner in the U.S. — will start production in Gravatai, Brazil, during the first half of 2000, following problems with the weather and the local government. Originally, the plant was expected to be up and running by mid-1999.

“We had such a terrible weather conditions at the beginning of last year,” says Marcos Munhoz, executive director-worldwide purchasing, production and logistics, General Motors do Brazil Ltda.

Severe rain temporarily halted construction at the plant, which was put in jeopardy again earlier this year when the local government suspended incentives promised to the automaker.

It took four months to get the incentives back, says Mr. Munhoz, but the government has agreed to fulfill its promise.

“We are back on track,” he says.

The plant is 90% finished but awaits completion of infrastructure improvements, including roads and electricity supply lines.

Nearby, Blue Macaw's 16 module suppliers are in the process of building facilities to supply the plant. Not all suppliers have been announced, but GM confirms cockpits will come from Mannesmann VDO Automotive. Lear Corp. will supply seats and Delphi Automotive Systems will provide suspension modules for the car, said to be similar in size and shape to the Ford Ka.