MEXICO CITY — BMW announced yesterday that it will invest $1 billion to build a luxury-car factory in northern Mexico that will start production in 2019 as part of an effort to expand its presence in the United States.
BMW board member Harald Kruger said the plant in the northern state of San Luis Potosi will have the capacity to make 150,000 cars per year while employing 1,500 people.
He made the announcement in Mexico City, accompanied by Mexican President Enrique Pena Nieto.
Kruger said the German automaker’s only other North American factory, in Spartanburg, S.C., will receive more investment to increase its production capacity to 450,000 cars by the end of 2016.
“This decision underscores our commitment to the NAFTA region,” Kruger said.
BMW, which has 28 factories in 13 countries, is also building a plant in Brazil.
The announcement comes a week after automakers Daimler and Renault-Nissan said they would invest $1.6 billion in a factory to make premium compact cars in Mexico.
Mexico is desirable for carmakers because of low wages, its proximity to the United States and free-trade agreements with 45 countries.