Ford intends to invest US$2.5-billion on two factories in Mexico to manufacture transmissions and diesel engines, said a person familiar with the company’s plans.
The second-largest U.S. automaker may announce this week that it’s spending US$1.3-billion to expand its Chihuahua engine plant and US$1.2-billion to build a transmission factory in Guanajuato state, according to the person, who asked not to be identified revealing internal plans. Ford will produce two new diesel engines in the Chihuahua factory, the person said.
Ford has been on a hiring spree in North America, adding more than 15,000 workers since 2011 as it boosts production to keep up with growing demand. The automaker, based in Dearborn, Michigan, currently has three factories in Mexico, producing the Fiesta subcompact, Ford Fusion family car and Lincoln MKZ sedan. Mexico, with low labour costs, has become a popular location for global automakers to produce cars for the U.S. market, which is in its sixth year of growth.
“The economics of auto production in Mexico make sense,” said Michelle Krebs, an analyst with researcher Autotrader.com. “And they have proven their quality is good.”
Reuters reported earlier Tuesday about the Mexico investment plans.
