News, Insights and Best Practices for Manufacturing in Mexico

Renault-Nissan and Daimler Launch Joint Venture in Mexico

14 Sep 2015

Category: Automotive Manufacturing

Renault-Nissan and Daimler recently broke ground on a joint venture in Mexico for an automotive manufacturing plant, WardsAuto reported. The Cooperation Manufacturing Plant Aguascalientes (COMPAS), will assemble Mercedes-Benz and Infiniti premium compact vehicles.

While Nissan has reaped the benefits of manufacturing in Mexico for some time now, the plant will be Mercedes' first venture in the country.

The two companies are investing $1 billion in COMPAS. The plant will have an initial production capacity of more than 230,000 vehicles annually. Additionally, the location will create at least 3,600 jobs by 2020 as well as 12,00 indirect jobs throughout the area.

Production on Infiniti models will begin in 2018, while Mercedes models will hit the market in 2018.

Mexico produced 3.2 million automobiles and exported 2.6 million automobiles in 2014 alone. The automobile industry in Mexico is expected to continue growing. Auto manufacturing continues to grow in Mexico.

A bright future for Nissan
Nissan's manufacturing efforts have been wildly successful in Mexico. As noted by the International Business Times, Nissan hit production records in both the United States and Mexico last year, making nearly 948,000 cars and increasing production in Mexico by 19 percent.

Currently, Nissan comprises 25 percent of Mexico's vehicle production, and in January, five Nissan models were among the top 10 bestselling cars in Mexico. The International Business Times also noted that last year, Nissan shipped roughly 538,000 of its vehicles from Mexico to other markets and sold the most new cars in the country. As a result of the company's new joint venture with Daimler, Nissan is expected to make over one million cars per year once Infiniti production begins in 2017.

Automotive manufacturing booming in Mexico
COMPAS is a direct product of Mexico's booming automotive manufacturing sector. As more companies realize the benefits of manufacturing in Mexico, where low labor costs, free trade agreements and proximity to high-demand markets only add to the appeal, the auto sector will continue to grow. According to the International Business times, Mexico hit record numbers in auto production and exports last year, producing 3.2 million automobiles and exporting 2.6 million.

The joint venture between Nissan and Daimler is just one among many new plants popping up in the country recently. Henniges Automotive also announced it recently broke ground on its new manufacturing facility in Gomez Palacio, Mexico. The location is expected to be operational by 2016, and is expected to hire up to 1,200 local employees.

Get a checklist of what to consider when  manufacturing in Mexico here!

Related posts