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We Hear: Kia Building Mexico Plant to Meet Increasing Demand

Motor Trend logo Motor Trend 6/3/2014 Jason Udy

In order to meet U.S. demand, Kia plans to build a new manufacturing plant in Monterrey, Mexico, Reuters reports. The news, however, comes from unnamed sources and hasn’t been confirmed by the automaker. One Kia spokesman told Reuters that several options are still being considered.

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Kia plans to build two small cars at the new plant, which is said to have a capacity of 300,000 units, according to the unnamed sources. The new plant would complement Kia’s lone U.S. plant in West Point, Ga. where the midsize Optima sedan and Sorento SUV are produced. ( Optima Hybrid models are built in South Korea.) Kia Motors Manufacturing Plant In Georgia Plant Worker© Provided by MotorTrend Kia Motors Manufacturing Plant In Georgia Plant Worker

"Hyundai and Kia are now more flexible with building new plants as their global manufacturing capacity has reached limits," Suh Sung-moon, an auto analyst at Korea Investment & Securities, told Reuters. "Without new factories, the duo is expected to lose market share in 2016 for the first time in over a decade."

A few years ago both automakers decided against building new facilities and adding capacity in order to avoid a decline in quality issues. These current rumors, however, suggest that Kia and Hyundai are ready to reverse their stance. The new Monterrey plant would be up and running about 21 months after construction begins, the report says. Earlier this year, Hyundai announced plans for a new plant in Chongqing, China.

Source: Reuters

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