Audi: New Entrant As Mexico Manufacturer

North America is set to gain yet another Mexico manufacturer, Audi, by 2016. Mexico has been steadily demonstrating its ideal near-shore location to Latin markets and the lucrative U.S. buying public for some time now and the Audi announcement confirms it. Audi CEO, Rupert Stadler, recently commented that “as an established car-making location, Mexico offers an excellent economic basis for Audi production operations”. Stadler added, (Mexico has) “good infrastructure, competitive cost structures and existing free trade agreements (that) played a significant role in the choice”. Audi’s long term goal is to increase global market share in both the U.S. and European markets and this latest announcement will undoubtedly contribute to that effort.

Additionally, Mexico manufacturer and Audi group member, Volkswagen AG, already has several plants operating in Mexico’s central region, thereby setting the trend. VW operates an automotive facility in Puebla, an engine plant in Silao and is slated to build a $500 million engine plant in Guanajuato. With VW already having a presence, the expansion pattern has been set and Audi’s entry as new Mexico manufacturer serves as one more example. Further, the new plant by Audi and VW will depend on the expertise of sheltering corporation, CPI (Co-Production International), who manages much of the set-up and administrative functions for the robust automotive industry in Mexico. With CPI managing day-to-day operations for certain tasks, a Mexico manufacturer is freed to focus 100% on manufacturing.

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