Mexico, a country in the NAFTA region that has lately become the place to go for global automakers that want to further expand their auto production in the Americas, has a deep relation with Germany’s carmakers.
At first, the country’s German auto history was tied to one iconic model: the Volkswagen Beetle. But the country’s sprawling commercial relations that span across the world have turned it into the place to be for top-of-the-line German brands – which are now building billion-dollar plants. In 2020, Mexico will be the fourth largest producer of German-made cars in the world, following their home country, China and the United States. According to the estimates compiled for Bloomberg by IHS Automotive consultant Guido Vildozo, they would overcome places such as Belgium, Spain and Brazil.
After Audi and Daimler’s Mercedes-Benz, the second and third-largest premium automakers in the world announced back in 2012 that Mexico would host new production facilities for the brands, BMW – the top global luxury carmaker – validated Mexico’s newly established position after it also chose the country for a new plant this year. Premium automakers (not just German ones) have jumped the gun in establishing new factories in Mexico, poised to become Latin America’s biggest vehicle producer, but mass-market automakers are following suit: South Korea’s Kia recently revealed it plans to establish a car production base through a $1 billion investment project.