Building cars close to where they are sold always makes the most sense and Korean automaker Kia has plans to move production much closer to the USA.
A new assembly plant in Mexico is on Kia’s to-do list, a source close to the matter revealed to Reuters. The new plant will be built in Monterrey and will have a 300,000 vehicle capacity, which will help Kia meet demand in the United States. At first, the plant will build two small cars for the brand.
About two years ago, Chung Mong-koo, chairman of Hyundai Motor and its Kia affiliate, placed a limit on new capacity over fears of quality issues born from fast growth. Now, it seems that he must be alright with moving forward on capacity increases, especially since Hyundai and Kia are currently operating at capacity worldwide.
In fact, one analyst says that if the companies don’t invest in more plants, they will begin to lose market share by 2016.
[Source: Automotive News]
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