Mazda will increase annual capacity of its Mexico plant to 230,000 units

Article by Christian A., on January 7, 2013

Mazda Motor Corp. said that the capacity of the factory that it’s constructing in Salamanca, Mexico, will be 21% bigger than the initial plan. This factory will also produce cars for Toyota Motor Corp. In a statement, Mazda said that this factory will build Mazda2 and Mazda3 small cars when it opens in 2014. It’s likely to have an annual capacity of 230,000 vehicles by March 2016.

In November, Mazda said that this plant can produce 190,000 cars each year. These include 50,000 small cars it's contracted to build for Toyota. For the New Year's event in Hiroshima, Japan, Mazda CEO Takashi Yamanouchi remarked that the boost in production capacity is a vital part of Mazda’s aim to reinforce its overseas production base as laid out in its medium- to long-term plan.

Aside from Mazda, other automakers such as Honda Motor Co. and Nissan Motor Co. have also announced plans to open lower-cost production facilities in Mexico to assemble small cars for North America.

Mazda is different from Toyota, Honda and Nissan since it now imports all the cars it offers in the U.S. from Japan after it had cut the production of Mazda6 sedans in Michigan. Mazda is predicting a net income of 10 billion yen ($114 million) for the year that ends in March, after posting a loss of 100 billion yen in the preceding 12 months for a third annual loss in four years.

When interviewed last November at the Los Angeles Auto Show, Yamanouchi said that the company aimed to expand the Mazda Motor Manufacturing de Mexico S.A. plant to go beyond the initial capacity figure.

He declined to elaborate. Yamanouchi said that Mexico has a highly attractive export base since it has both lower production costs and free-trade deals with 37 nations. Mazda said that investment in the plant, a joint venture with Sumitomo Corp., amounts to around $650 million, which includes the expansion costs.

Topics: mazda, mexico, plant

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