Why did KIA Motors choose Nuevo León?

It will invest more than 1,000 million dollars to manufacture 300,000 units by the first half of 2016

Kia Motors, a subsidiary of the South Korean automaker Hyundai, will invest more than 1,000 million dollars (mdd) to build an assembly plant in the municipality of Pesquería, Nuevo León, where it will assemble 300,000 annual units of up to three compact models, Hyoung-Keun Lee announced. , CEO of the firm.

With the construction of a plant in the north of the country, the firm will be able to supply more quickly and efficiently – Pesquería is about two hours from Laredo, Texas – to the US market, where it sells just over 500,000 units a year.

In 2008, Kia's annual sales in the United States stood at 273,397 vehicles and six years later, in 2013, the number almost doubled. Demand that was mainly supplied by the production of the Georgia plant.

This plant, however, reached the limit of its capacity, so the firm made the decision to build a second plant in the region. Industry analysts warned that if it did not increase its production capacity in North America, Hyundai would lose market share.

Kia Motors chose northern Mexico as the site of its new plant. Since 2010, it has explored several options –including Guanajuato and Jalisco-, however, the proximity to the United States and the railway connectivity played in favor of Nuevo León.

In addition, the entity produces 30% of auto parts in Mexico and has specialized labor. through the cluster automotive Nuevo León (Claut) has promoted the training of toolmakers and electromechanical technicians, said Rodrigo Medina, governor of the entity.

The economic benefit that Hyundai will bring to the entity will exceed the initial investment of more than 1,000 million dollars. It is estimated that KIA could reach up to 30 Tier I and Tier II suppliers.