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Ford, Toyota to Invest Combined $3.5 Bil in Mexico

Makers join growing list of makers expanding ops South of the Border.

by on Apr.15, 2015

Toyota confirms it will build the next-generation Corolla model at a new plant in Mexico.

Following announcements of major investments in both Mexico and India, Ford Motor Co. is set to make a $2.5 billion bet closer to home. Meanwhile, Toyota Motor Co. has confirmed recent reports that it will invest $1 billion in a new Central Mexican plant to produce its compact Corolla model.

Toyota and Ford will join a growing list of manufacturers either entering or expanding operations in Mexico which is now one of the world’s largest producers of automobiles. That includes carmakers from Europe, Asia and Detroit, as well.

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While Ford is not officially confirming the announcement — stating it “cannot comment on future product or manufacturing plans” – Toyota North American CEO Jim Lentz said the new Corolla plant is part of a “strategic re-thinking of how and where we build our products will create new opportunities for our company, our business partners and our team members across the region.”


New Audi Plant Rises Out of the Mexican Dust

German luxury maker takes a $1.3 billion risk with next Q5.

by on May.22, 2014

The next-generation Audi Q5 will be produced at the maker's new Mexican assembly plant.

A steady stream of trucks roars across the parched field kicking up swirls of dust. The new Audi assembly complex is quite literally rising out of the high plains desert, an hour outside of the city of Puebla, the maker pouring another 19 feet of soil atop the two square miles of barren land it is has acquired for the project.

Audi is the latest in a fast-growing line-up of manufacturers to invest in Mexico, the maker drawn to the country for both its low labor costs and, perhaps more importantly, the numerous free trade agreements the Mexican government has negotiated.

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That will make it easy to use the new, $800 million plant as the sole source for the maker’s next-generation Q5 sport-utility vehicle. Indeed, Audi has already laid out plans to double the factory and shift even more production there from Germany.

“This marks the point at which we will build more cars outside Germany than at home,” notes Klaus-Peter Koerner, who will manage production at the facility when it opens in mid-2016.


Audi Picks Puebla for New North American Plant

Plant will be 40 miles from existing VW factory.

by on Sep.04, 2012

The new plant will build an updated version of the Audi Q5 crossover, starting in 2016.

Audi will build a new “ground-up” assembly plant in the southern Mexican city of Puebla, a factory it will use to supply the U.S. and a number of other markets around the world.

The factory will be located near another assembly line operated by the luxury maker’s parent Volkswagen AG and used to produce vehicles including the latest VW Beetle and Jetta models.  When it goes into operation in 2016, the Audi plant will have the capacity to produce up to 150,000 vehicles annually.

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“We are proud that Audi, a leading European premium manufacturer, has chosen our country as a future production base,” said Puebla state Gov. Rafael Moreno Valle.

Audi has been debating the need for a North American plant for more than a decade.  The issue has been pressed by the maker’s rapidly expanding sales, especially in the Americas, where it long lagged behind better-known German brands BMW and Mercedes-Benz.


Mexico Auto Output to Jump 38% in 3 Years

Low wages, good location offset concerns about the ongoing drug war.

by on Aug.30, 2012

Workers in Puebla gathered to celebrate the launch of production of the latest VW Beetle.

While Mazda may have abandoned its decades-old joint venture with Ford, transferring production of the Mazda6 sedan back to Japan, the maker isn’t walking away from North American production entirely.

By mid-decade, the Japanese maker plans to open a new factory in Mexico to produce smaller products like the Mazda3.  And it isn’t alone.  Honda, Audi and Nissan are among the growing list of automotive manufacturers who have announced big plans for Mexican plants.  Mercedes-Benz is also expected to add an assembly line South of the Border to complement the factory it currently operates in Alabama.

It’s all expected to add up to a whopping 38% jump in automotive production in Mexico over the next three years – an additional 1 million vehicles, according to the head of that nation’s investment promotions agency.

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“Other companies are exploring the possibility of opening facilities in Mexico,” Carlos Guzman, president of ProMexico, told the Bloomberg News Service. “We expect a very good period of five to seven years in Mexico in terms of growing (automotive) exports.”


Honda Latest to Add Plant in Mexico

South of the Border becomes the new direction for the auto industry.

by on Mar.29, 2012

Honda CEO Takanobu Ito, (center right) during groundbreaking ceremonies in Mexico.

Honda de Mexico, S.A. de C.V. has begun construction of a new plant in Central Mexico – making the Japanese maker just the latest to take advantage of Mexico’s low wages and strategic location.

The new plant will begin operation in 2014 with production of the Honda Fit subcompact model, said Takanobu Ito, president & CEO of Honda Motor Co., Ltd.

Honda’s announcement comes barely two months after Nissan revealed plans for a massive, $2 billion assembly complex in Aguas Calientes, in Central Mexico – with Mercedes-Benz also considering construction of a new plant not far from the Nissan site.

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With this new facility in Mexico, Honda continues to advance its commitment to invest in and grow its operations in North America, Ito said. With growing demand for fuel-efficient vehicles, the new plant will increase Honda’s ability to meet customer needs for subcompact vehicles from within North America.


Mastretta MXT is One Hot Tamale

Mexico’s first sports car comes to LA.

by on Nov.18, 2011

Mastretta wants to begin selling Mexico's first sports car in the U.S. next year.

We’ve seen plenty of cars come in from Mexico, in recent years, as more and more makers take advantage of that country’s low labor costs and proximity to both the U.S. and fast-growing markets in Latin America.  What we haven’t seen are cars produced by a Mexican car company.  Until now, anyway.

That’s about to change with the upcoming launch of the new Mastretta MXT, a Lotus Elise-sized 2-seater being billed as Mexico’s first-ever sports car.

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The Mastretta MXT got its introduction, this week, at the L.A. Auto Show, founder and product chief Daniel Mastretta suggesting the MXT is an example of “form following racing car design.  But it’s a practical car that people can use every day.”

The semi-monocoque aluminum design makes use of lightweight carbon fiber-reinforced plastic, or CFRP, to enhance its strength while also holding down weight – which comes to just 2,100 pounds.

The MXT was developed inside-out says designer Daniel Mastretta, body and chassis seen here

The vehicle, asserts Mastretta, was developed “from the inside-out,” to put an emphasis on usable performance from a small package measuring just 153.5 inches nose-to-tail, 69 inches wide and 46 inches tall.  The little roadster’s wheelbase in 95.1 inches.

Power comes from a 16-valve intercooled turbo version of the Ford Duratec, an inline-four engine of 2.0-liters displacement.  The Mexican manufacturer claims it will make 260 horsepower and 257 lb-ft of torque, channeled through a 5-speed manual gearbox to the rear wheels.

The maker is claiming 0 to 60 times of just 4.9 seconds, only a bit slower than the 2013 Porsche 911 Carrera.

The MXT is being assembled by Tecnoidea, an engineering and design firm, at a plant in Mexico City.  The firm bills itself as Mexico’s only native automaker.

Expect to see the Mastretta MXR reach the U.S. early next year with the price tag tentatively set at somewhere between $60,000 and $65,000, according to company officials.

Setting up a U.S. distribution network is a work in progress.  But if Mastretta can pull it off, the start-up maker will be targeting buyers who might have opted for the Lotus Elise had the British company not halted imports this year.

Mexican Government Desperate to Assure Foreign Auto Investors

Countering fears as drug-related violence spreads.

by on Nov.18, 2011

Beetle production begins at the VW plant in Puebla.

Faced with a “frightening” rise in violence, the Mexican government is racing to head off a wholesale move away from the region that serves as the base for many foreign automakers and suppliers,

Mexican security services are offering special private briefings on the government’s strategy for combating violence across that violence-plagued nation, especially in the north where American companies have built hundreds of automotive factories over the past three decades.

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Sergio Rios, a representative of Pro Mexico, an agency of the Mexican government designed to encourage foreign investment, said the special briefings are designed to explain to investors the country’s strategy to combat the drug-related violence that has created havoc across northern Mexico. The briefings are also designed to offer some reassurance about the broader security situation, which is giving some companies pause about investing in the violence-plagued nation.