Volkswagen has laid the foundation stone for its new engine plant in Silao, Mexico, which will supply vehicle plants in North America with up to 330,000 engines per year from 2013.
Hubert Waltl, Volkswagen production chief, said the new Silao plant will strengthen the company’s market position in North America and is an essential component of the group’s global growth strategy.
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VW is planning annual sales of 1m vehicles in the US from 2018 based on models such as the Jetta and Passat tailored to the demands of American customers which will be produced at North American plants with a high degree of localisation.
From 2013, the new factory in Silao will supply engines to the vehicle plants in Puebla, Mexico, and Chattanooga, Tennessee. Silao is designed for an annual capacity of 330,000 engines. Investment in developing the new engine as well as building the new plant runs at US$550m.
VW said it will create approximately 700 new jobs at the plant in the medium term. Further jobs in the region will also be created at suppliers and in the logistics sector.
Otto Lindner, chairman of Volkswagen de México, said that VW accounted for 435,000 locally produced vehicles last year. “Silao is a big step towards the future for us. We are triggering new momentum for growth and employment in the Mexican automotive industry.”
Currently, the Jetta, Golf/Jetta wagon and Beetle are produced in Puebla. Production of the US Passat will begin in Chattanooga in the first quarter of 2011.
