BMW is investing 800 million euros (approximately $858 million) to ready its San Luis Potosí, Mexico factory to build the next generation of its Neue Klasse EV model, the automaker announced last week.
The San Luis Potosí plant, which began production in 2019, currently manufactures three gas-powered BMW models. The luxury vehicle manufacturer said the investment will create 1,000 jobs and help reach its goal of making half of its sales electric by 2030.
Production of the EV model will begin at the Mexico plant in 2027, following assembly at its plants in Hungary and Munich.
More than 500 million euros will be spent on constructing a new battery assembly plant on the manufacturing campus to build the Neue Klasse, according to the release.
Mexico is the seventh largest vehicle manufacturer in the world and produces approximately 3 million vehicles yearly, according to the International Trade Administration. Ninety percent of those vehicles are exported, with 76% going to the U.S.
BMW is one of a host of automakers with facilities in Mexico, including Stellantis, Ford, GM, Honda, Hyundai and Toyota.
Vehicle manufacturers are predominantly located in the northern region of Baja California, Sonora, Chihuahua, Coahuila, Nuevo León and San Luis Potosí.
“The company is increasing its commitment to Mexico and its stake in our facility, not only due to its strategic location but, above all, to a solid work team, which, in less than four years after starting operations, already produces three models that supply 74 global markets and stand out for their quality,” Harald Gottsche, president and CEO of BMW Group Plant San Luis Potosí, said in a statement.