Luxury car maker BMW revealed a $1bn Mexican plant investment on Thursday, becoming the latest major automaker to take advantage of the country’s growing industrial base and tariff-free access to the US market.
BMW outlined plans to build a factory in the central Mexican city of San Luis Potosi, reducing the German company’s dependence on higher-cost plants at home.
The plant will begin assembling models in 2019 with an initial workforce of 1,500 and annual production capacity of 150,000 vehicles, the company said.
“Mexico is an ideal location for the BMW Group,” production chief Harald Krueger said in a statement. “We are continuing our strategy of ‘production follows the market.’”
Germany’s luxury car makers - BMW, Audi and Mercedes-Benz - are expanding overseas as their domestic plants struggle to meet strong demand for new vehicle offerings in the United States and Asia.