Audi Planning North American Assembly Plant, Possibly in Mexico

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Executives at Audi have definite plans to open the company’s first assembly plant in North America, and may be favoring a location in Mexico. According to WardsAuto, Audi has made a firm decision to open the plant, but now must decide on its location and timing.

“It’s not a matter of if we will do a plant in North America, but when,” Audi of America president Johan de Nysschen told Wards. “It’s a matter now of waiting to pull the trigger.”

The company is said to be strongly considering opening its new assembly plant in Mexico, in part because of the country’s lower labor costs compared to the U.S. According to Wards, a Mexican facility also would allow Audi to export vehicles to South America, and even to Europe if necessary, without paying excessive import and export tariffs.

There are no plans for Audi to join parent company Volkswagen in Chattanooga, Tennessee. The new Volkswagen factory there, which builds the Jetta and Passat, will reportedly need all of its capacity to build those vehicles, and doesn’t have any additional space to add Audi products.

Audi has long been considering opening an assembly plant in North America for several reasons. A factory on our shores would prevent Audi’s U.S. sales from being affected by currency shifts in Europe, and also would help Audi increase its overall volume here by increasing vehicle availability. Some key Audi models, including the Q5 and Q7, have such low inventory levels here that customers must wait several weeks to receive their vehicle.

Audi has previously said it wants U.S. sales to reach 150,000 by 2015. In 2011, the brand sold 117,561 cars here, a year-over-year gain of 15.7 percent and the best annual sales in Audi of America’s history.

Source: Wards Auto

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