General Motors (GM) will locally assemble the Chevrolet Groove and Aveo at its Ramos Arizpe facility in Coahuila state from 2027, shifting both models away from Asian (China JV) production bases.
The change forms part of a $1bn investment first announced in January 2026.
It is intended to bring annual domestic vehicle output to 80,000 units by 2030 – all of which are currently imported.
Assembly will take place across GM's existing complex in Ramos Arizpe, where the company runs five plants and employs more than 5,000 workers.
Francisco Garza Rodríguez, president and CEO of General Motors Mexico, announced the development at an event attended by Mexican President Claudia Sheinbaum Pardo and Economy Secretary Marcelo Ebrard Casaubón.
The initiative sits within Mexico's Plan Mexico framework, which seeks to expand domestic manufacturing and reduce import dependency amid ongoing tariff pressures on vehicle production.
GM has maintained a presence in Mexico for three decades and currently employs more than 23,000 people directly across four manufacturing complexes.
The company sources components from a network of 650 domestic suppliers, with annual procurement totalling $28bn, and operates more than 300 sales points carrying a portfolio of over 40 models.
More than 700 Mexican engineers are involved in designing and validating parts for both local and international markets.
The announcement comes alongside broader restructuring activity at GM.
The company began cutting 500 to 600 salaried positions within its information technology division on 11 May, primarily affecting staff in Austin, Texas, and Warren, Michigan, as part of wider cost reduction efforts.
Separately, GM agreed this month to pay $12.75m to settle a California lawsuit alleging it had shared OnStar subscribers' personal and driving data without adequate disclosure or consent.
The case was brought by the California Attorney General and district attorneys from Los Angeles, Napa, San Francisco and Sonoma counties, with the California Privacy Protection Agency lending its support.
