Nissan to invest $2 billion in a new plant in Mexico

Article by Christian A., on November 7, 2011

A Mexican state government has revealed that Nissan Motor Co. is thinking about investing $2 billion for a new facility in the country. However, the automaker continues to study various growth opportunities. In a statement, the government of Aguascalientes said that Nissan already operates a plant located in the north-central state.

Nissan is considering making new manufacturing investments in Mexico, which is the second biggest economy in Latin America. A Nissan spokesman in Mexico said that the company will continue to “study opportunities to install additional capacity" in key markets.

Nissan already has a plant in the city of Cuernavaca located south of Mexico City. Nissan has yet to announce the details about the expansion of its manufacturing capacity in Mexico.

Aguascalientes said that state governor Carlos Lozano de la Torre had discovered during a journey to Japan that the state was in the running for this plant. Aguascalientes said that this plant will add about 10,000 jobs for the medium-term.

In the governor’s Oct. 24, 2011, trip to Japan, the governor told Carlos Ghosn, Chief Executive Officer of Nissan and its French affiliate Renault SA, that his state is the best option for the plant. Lozano de la Torre said that Nissan will decide on Nov. 18, 2011.

There are five other Mexican states competing for the plant but the identity of the other states hasn’t been divulged. As the strong yen has been eroding profits on exports, Nissan and the other Japanese automakers were exploring methods to transfer the production of cars and parts outside Japan.

Nissan Motor Co. first arrived in Mexico in 1959 as an importer of vehicle. Two years later in 1961, Nissan Motor set up Nissan Mexicana, S.A. de C.V. as an entity that would import and distribute its vehicles. In May 12, 1966, Nissan Mexicana commenced it car manufacturing operations at Ciudad Industrial del Valle de Cuernavaca. The plant was Nissan’s automotive site outside of Japan. Moreover, Mexico became the first country to build Nissan cars outside of Japan.

In November 13, 1982, Nissan Mexicana opened its Aguascalientes plant, which operations included production of components and stamping of vehicles. Nissan´s manufacturing operations eventually expanded with new projects.

This year (2011) marks 50 years of Nissan Mexicana, which workforce now numbers more than 10,000 people. Nissan Mexicana’s current operations include corporate, design, manufacturing, distribution, marketing and sales. Nissan Motor’s Mexican unit holds an 18.2-percent share of the domestic market – making it the current leader in the country.

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