New Automotive Audi investment plant in Mexico

By Adina Moloman

Sources: Co-Production International, Financial Times

Audi, the luxury car unit of Volkswagen is considering Mexico for its next big investment in North America, starting in 2016.

According to the Minister of Economy, Bruno Ferrari, the investment would be worth about $2 million and the main reason of the investment is to cover the additional demand for production for the next years. Currently the manufacturing of the luxury unit is given in the main two factories of Audi in Germany.

Audi selected Mexico as its next investment for a few strategic consideration: first Volkswagen, which is Audi’s parent company, already operates facilities in Mexico; there is a huge presence of Automotive Mexico Manufacturers which are manufacturing a variety of auto parts from seat belts and sound speakers to carbon fiber body kits, chassis, electronic sensors, metal parts, etc., which covers its necessity of auto parts providers; the advantage of low, well qualified and experienced labour force; Mexico Manufacturing infrastructure and logistics; exemption of tariffs and the existence of a free trade agreement with USA, the main distribution market for the future production.

So far was revealed that the new Audi production plant in Mexico will assemble sport utility vehicles (SUVs), with production set to start in 2016, but there was not revealed the number of jobs that will generate.

So far was not mentioned the location of this plant in Mexico,  its capacity  or even  which vehicle Audi will make at the plant but the rumors are considering the  second-generation Q5 SUV .

The goal for the Audi plant is to sell at least 1 million cars each year in the U.S. by 2018 and of course to overtake BMW as the world’s leading premium passenger carmaker, considering the Audi presence in the US market has been weak.