Chrysler Group LLC will hire 500 new employees at its Ramos Arizpe engine plant in Mexico, two people privy with the matter told Bloomberg. The sources said that Chrysler chief executive Sergio Marchionne will disclose details of the plans later this week when he visits the Saltillo location -- where the carmaker operates four sites -- along with Mexican President Enrique Pena Nieto.
Chrysler is investing around $164 million to expand output at the Ramos Arizpe engine site. Carmakers are expanding production in Mexico to take advantage of lower labor costs that boost profitability of vehicles sold in the US. Chrysler commenced the output of the Ram ProMaster at a nearby facility in July. Marchionne recently remarked that the van assembled in Mexico uses some parts from Fiat’s Ducato site in Italy.
Armando Soto, president of Kaso y Asociados auto industry consulting firm, remarked that Mexico is “quite competitive in the automobile industry,” adding that more investments “like this” will come to the country. He quipped that this kind of investment “helps consolidate a region as an automotive cluster.”
Audi is investing $1.3 billion in its San Jose Chiapa site, which will have an annual capacity of 150,000 cars. General Motors has allocated $691 million to expand three existing sites in Mexico. Fiat is also producing the North American version of the 500 subcompact at its Toluca site.