Brazil's WEG invests $77 Million to increase US plant capacity because of AI demand

The Brazilian motor manufacturer WEG announced on Tuesday that it would invest $77m in a U.S. facility for the production of specialty transformers. It aims to increase the plant’s capacity by 50%, as artificial intelligence is driving demand in the U.S. WEG says that the investment in Washington, Missouri's plant is aimed at the production of transformers, which are essential for supporting the expansion in industrial manufacturing, data centres and grid stability in America. This factory produced transformers for wind power and continues to do so to some extent. Peter Barry, WEG’s managing director for the U.S. said that this would be more closely related to data centres and AI.

He said that the investment would be spread over three years. The additional production capacity will come online no later than 2028.

Barry stated that as the market evolves, new investments could be made in U.S. plants to meet the rising demand.

"But we still have time to adjust and be flexible to any changes that may occur." Barry stated that conditions can change and we must remain flexible.

The executive stated that the firm will be able pre-sell its capacity, and even though the investment will be heavily focused on automation, around 50 jobs will still be created.

WEG is a company that has been around for many years.

Impact

Tarif

Barry said that the tariffs imposed by Donald Trump on U.S. imported Brazilian goods had no impact on his decision to invest.

Barry said that the growth of WEG in North America over the past few years was very strong. He predicted this to continue. (Reporting and editing by Gabriel Araujo, Mark Porter and Fabio Teixeira)

(source: Reuters)