Audi to Build New Factory in Mexico, will Manufacture an SUV from 2016

The board of directors have spoken and it has been decided that Audi will build its first North American plant in Mexico. The German automaker said it is still searching for a location to erect the facility, but noted that the selection process will be completed before the end of this year.

The new plant will become operational by 2016 and will start production with an SUV, most likely the next generation of the Q5 compact crossover.

“As an established carmaking location, Mexico offers an excellent economic basis for Audi production operations,” said Audi CEO Rupert Stadler.

“Good infrastructure, competitive cost structures and existing free trade agreements played a significant role in the choice of Mexico. This trailblazing move will help us safeguard our position on the world market. Our German locations, too, stand to benefit from it,” he added.

Audi says that the facility is a crucial part of the company’s plans to sell two million units per year by 2020, including 200,000 vehicles annually in the States, up from around 117,000 last year.

Audi’s decision to build a plant in Mexico comes only a year after the VW brand opened the group’s only factory in the United States, in Chattanooga, Tennessee. Rival carmaker BMW has a manufacturing facility in South Carolina while Mercedes has opened a plant in Alabama.

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