GM decides to build next-generation Chevy Cruze compact in Mexico image

General Motors, the largest US automaker and the third-biggest in the world, has announced on Monday it would produce it upcoming next-generation Chevrolet Cruze compact in Mexico.

In recent years all major automakers have looked to expand their manufacturing footprint in the Latin American country, which has attracted them with a big set of advantages: low labor costs, numerous free-trade agreements with all key regions and a position as an export hub between Latin and North America. The US carmaker last year announced a set of investments totaling $5 billion to be used by its Mexican plants and of the amount $350 million will be used to cater for the upcoming production of the next-generation Cruze at the company’s factory in Coahuila. GM will also continue to produce the model at its Lordstown, Ohio, plant as well. The company has so far acknowledged the upcoming new generation Cruze would be manufactured in three assembly facilities, including China. Additionally, a GM spokesperson confirmed the factory in Gunsan, South Korea, is scheduled to continue the production of the current generation Cruze to fulfill domestic and export orders. A labor deal signed last year in the summer also had GM pledging the upcoming generation would be manufactured in Korea from 2017.

As far as Mexican production is concerned, the GM officials in the country said the upcoming production would be mostly directed towards internal needs. Last year, 7,870 units were sold in the country, a drop of almost 15 percent from 2013 levels, according to figures from the Mexican Association of Automobile Distributors and the Mexican Automotive Industry Association. Today eleven global factories produce the current generation Cruze model, but in the future some of them – including one factory in Australia where GM is ending its assembly operations – will not go on to produce the upcoming new generation model.

Via Reuters