Vw planning to start Golf and GTI production in Mexico

Article by Christian A., on January 28, 2013

Volkswagen has fallen behind its global rivals in North America and so to increase its market share, it is now planning to start production in Mexico for its Golf hatchback. Starting in the first quarter of 2014, VW will produce the Golf at its plant in Puebla. VW spokesman Christoph Adomat said that Golfs assembled at this plant will be offered in North and South America.

Its production will supplement output of the model at VW's home base in Wolfsburg and in Zwickau in eastern Germany.

In a statement, Volkswagen's North America chief Jonathan Browning said that producing the Golf in the Puebla factory aids Volkswagen to hit its target of producing over 75% of the cars Volkswagen of America offers for sale in the North American region. This plan to build the Golf in Mexico is part of a strategy that seeks to spend $5 billion over the next three years in North America.

The growth in this area is crucial to CEO Martin Winterkorn's scheme to attain the title as biggest automaker in the world by 2018.

VW wants to build the Golf in Mexico to benefit from reduced labor costs and to protect itself from the unfavorable currency fluctuations between the dollar and euro. In a statement, Hubert Waltl, the head of production at VW's passenger car brand, said that Mexico is the “ideal location” for the Golf production because of its infrastructure, free trade agreements, and cost structures that are competitive.

Daniel Schwarz, an analyst with Commerzbank in Frankfurt, said that Volkswagen has lofty growth targets to meet and so it would have to localize production in order to realize those plans.

He added that the company can’t succeed in the mass-market segment if all they do is import cars. VW really has to expand outside its domestic market. In December 2012, VW’s Europe sales fell by 15%, contributing to the 1.1% decline in 2012. Because of the impact of the debt crisis, the European car market is predicted to decline for the sixth consecutive year in 2013.

If you liked the article, share on:

Pin It

Comments

Recommended

To the proud owners and owner-to-be of the Porsche 991 Carrera GTS, there's good news for you all. German automobile manufacturer Porsche recently confirmed to the public that the Porsche...
by - March 23, 2017
McLaren diehards, this is the moment that you're all waiting for. The British automaker recently publicized the teaser outline of its new automobile that will hit the streets soon, dubbed...
by - March 23, 2017
PSA seems very confident about conquering the world. The purchase of Opel/Vauxhall for €2.2 billion ($2.3B) from General Motors makes PSA the second largest car company, just behind the Volkswagen...
by - March 23, 2017
Reporting for duty. It’s been a year since the Victoria Police was loaned a new Mercedes-AMG GLE 63 S Coupe. In those 12 months, the coupe served as the law...
by - March 23, 2017
After making its debut at the Paris Motor Show last year as a concept car, the Trezor by Renault managed to bring home the 2016 Concept Car Design Of The...
by - March 23, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries