Volkswagen to invest $1 billion to expand Mexico factory for Tiguan production image

German automaker Volkswagen AG, the largest in Europe and the second-biggest carmaker in the world, has recently announced it plans to spend around one billion dollars to prepare its vehicle assembly facility in Puebla, Mexico for the production of the next generation of the compact SUV Tiguan.

In preparation for the arrival of the crossover’s next generation the investment will focus on adding new assembly lines and lifting the workforce by another 2,000 new entries, according to Andreas Hinrichs, chief executive of Volkswagen Mexico. According to a company statement the production is scheduled to begin in late 2016 – which also gives us a framework for the model’s introduction to the markets – as the Tiguan is scheduled to reach dealerships the next year. Hinrichs added that the company is gearing up for a production output of about one million units of the Tiguan at the factory over the course of eight years – with some of the production also aimed at the local Mexican market.

According to government data, since President Enrique Pena Nieto took office two years ago the total auto industry investments in Mexico before last December skyrocketed to $19 billion. Mexico – thanks to recent trading agreements that made the country a popular auto production and export hub – is currently the world’s seventh largest auto manufacturer and the world’s fourth biggest exporter, according to Mexican industry body AMIA. The Mexican Automotive Industry Association (AMIA) figures also show VW’s Puebla plant produced in 2014 a total of 475,121 vehicles out of about 3.2 million produced in Mexico.

Via Reuters