BMW announces Mexico plant

After months of rumors, BMW has confirmed that it will build a new production facility in Mexico. The German automaker will spend about $1 billion to establish a new production base in San Luis Potosí, located about 250 miles north of Mexico City.

“Mexico is an ideal location for the BMW Group and will be another important plant within our production network,” said Harald Krueger, member of the BMW AG Board of Management, responsible for Production. “We will invest one billion U.S. dollars in the new production site over the next few years.”

BMW estimates the plant will be up and running by 2019 with an annual capacity of 150,000 units. The plant will directly create 1,500 new jobs for the region.

BMW will announce which models will be built in San Luis Potosí at a later date.

The plant is expected to mostly supply the United States market, but global exports are also possible. Of course some of the vehicles will stay in Mexico, but the country represents just a sliver of BMW’s worldwide sales. BMW sold 13,992 vehicles in Mexico last year, compared to 35,577 deliveries in the U.S. last month alone.