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Ford Announces $2.5 Billion Mexico Investment

Executive Summary

Ford is just the latest global automaker to expand in Mexico, lured by the country’s many free trade agreements, low wages and inexpensive land.

Ford confirms plans to invest $2.5 billion in new engine and transmission plants in the Mexican states of Chihuahua and Guanajuato, following an industry trend of ramping up production in the country.

“Ford is making a significant commitment to our business in Mexico with investment in two new facilities, while aiming to make our vehicles even more fuel-efficient with a new generation of engines and transmissions our team in Mexico will build,” Joe Hinrichs, president-The Americas at Ford, says in a statement today from Mexico, where the automaker is celebrating its 90th year of business.

“These new engines and transmissions will help deliver even better driving experiences and fuel-economy gains for customers around the world,” he says.

Details on the new engine for Chihuahua were not released, but it will be a gasoline model powering Ford small-car offerings in the U.S., Canada, South America and Asia-Pacific. The automaker currently builds 4.4L and 6.7L V-8 diesels at Chihuahua, which as part of the investment will see its assembly line expanded.

Once completed, the upgrades to Chihuahua will make it the largest engine plant in Mexico.

The new transmission plant in Guanajuato will build automatic gearboxes. The transmissions, built with Ford partner and transmission expert Getrag, will supply products sold in South America, Europe, Asia-Pacific and North America.

The three projects will create 3,800 jobs, Ford says.

Ford is just the latest global automaker to expand in Mexico, lured by the country’s many free trade agreements, low wages and inexpensive land.

Toyota revealed earlier this week it would build a $1 billion assembly plant in Guanajuato for the Corolla small car in 2019, while General Motors, FCA US and Nissan soon will build new CUVs at existing sites in Mexico. Kia plans to make small cars in Monterrey, Mazda has built the Mazda2 and Mazda3 in Salamanca since 2014, and Honda just launched production of the HR-V in Celaya.

jamend@wardsauto.com

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