BMW is following rival Audi into Mexico with a US$1bn plant planned to start production in San Luis Potosi in 2019, the company’s production chief Harald Kruger announced.
“Mexico is an ideal location for the BMW Group and will be another important plant within our production network,” he added.
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This will be BMW’s second plant in the NAFTA (free trade) region. Its US factory in Spartanburg, South Carolina, now specialising in SUVs, was opened in the early 1990s.
Daimler also has a Mercedes plant in Tuscaloosa, Alabama in the southern US. During the DaimlerChrysler era it had the now Fiat-Chrysler-owned plant in Toluca, Mexico, which made the PT Cruiser and other Chrysler models.
BMW’s Mexican plant will employ around 1,500 by 2019 and have an annual output of 150,000; BMW said it would announce later which models it would make there. Audi’s new Mexico plant will start with the Q5 medium SUV while Mercedes’ US plant also makes SUVs, has just added the C-class for the first time and, only last week, began production at a new joint venture engine plant with Nissan’s Infiniti built on the same site.
BMW said the additional factory would allow it to take full advantage of Mexico’s lower costs and the North American Free Trade Agreement which gives access to the key US car market.
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By GlobalData“This decision underscores our commitment to the NAFTA region. We have been building BMW cars at our US plant in Spartanburg for the past 20 years. With a planned annual capacity of 150,000 units for the new plant in Mexico, the BMW Group will be even better positioned to take advantage of the growth potential in the entire region,” Krüger said. “The Americas are among [our] most important growth markets. We are continuing our strategy of ‘production follows the market’,” he added.
In March, BMW announced a US$1bn expansion for Spartanburg, taking annual production capacity to up to 450,000 vehicles by the end of 2016 and making it the largest plant in the BMW Group’s international production network.
Another BMW factory in Santa Catarina in Brazil is scheduled to start production later this year.
