Fiat to Launch Electric Cars in Brazil

Electric energy utility Companhia Energetica de Minas Gerais (Cemig), the huge Itaipu Binacional hydroelectric dam and Fiat Automoveis SpA are joining efforts to produce electric vehicles (EVs) in Brazil.

Initially, just 30 cars, bearing the brand name Fiat Palio, will be produced this year, to be distributed and exhibited at energy facilities throughout the country.

To date, Cemig, Fiat and Itaipu collectively have invested approximately BR3.4 million ($1.8 million) in the project.

Virgilio Medeiros, Cemig technology and development engineer, says the purpose of the project is to show Brazilians it is possible to make a car that plugs into an electric outlet and does not depend on fossil fuel.

Medeiros says Itaipu has been developing EV projects for five years. Since 2005, Cemig has been working together with Itaipu.

“We joined forces. Cemig needs to invest money in research projects, while Itaipu needed financial partners to develop the electric-vehicle project,” he says.

In Europe and the U.S., about 300,000 EVs are sold annually, competing with fossil-fuel cars, he says. “They have this ecological appeal, since the electric vehicle does not pollute, nor make noise.”

He says that in London there are streets where only EVs are allowed (London instituted “congestion charging” in 2003, exempting certain alternative-fuel vehicles, including EVs).

But in Brazil, according to Medeiros, EVs should take about five years to begin circulating in higher volumes. The batteries are produced in Switzerland by KWO.

“Each vehicle would cost about $36,000 (BR68,751). Producing on greater scale and developing technology in Brazil, the price will come down,” says Medeiros.

Medeiros adds that a battery-production facility could be opened in Minas Gerais state, near Fiat’s operations, the partner automotive company that has been conducting research on EV projects.