South Korean Automaker Kia to Construct a $1 Billion Car Assembly Plant In Mexico
On Wednesday, Kia Motors Corp. the South Korean automaker said that it has decided to construct a car assembly facility in Mexico$1 billion and hopes to complete it by 2016. The company also said that this new plant will assist it to get a local production base that is required meet demand for new cars globally.
The company said that it has already inked an agreement for investment with the Mexican government to construct the manufacturing facility in Monterrey. Kia Motors Corp. is partly owned by Hyundai Motor Co.
The construction is expected to begin in September 2014 and is likely to be completed during the initial half of 2016. The company intends to develop the plant in Mexico to support its sales presence in Central as well as the South American region.
The company said, Mexico was chosen to be its new location for a manufacturing plant overseas as this a major market where Kia does not have a presence for the sales of its vehicles.
Moreover, Mexico is also recognized for its cheap and skilled work force along with several free trade agreements with around forty countries. Globally, Mexico is the fourth largest exporter of automobiles.
Kia Motors also stated the close proximity of Mexico to the U. S. will help the company to solve the short supply situation which has grown as a result of the growing demand for Kia's products in the existing U. S. market.