Kia to Invest US$649 Million to Build EV3 Electric SUV in Mexico

South Korean automaker Kia has announced a US$649 million investment in Mexico between 2026 and 2028 to establish its first electric vehicle manufacturing operations in the country.

The strategy includes shifting production of the all-electric Kia EV3 SUV from South Korea to the company’s existing assembly plant in Pesqueria, Nuevo Leon. Production of the new EV assembly line is scheduled to begin on Aug. 4. The project aligns with Plan México, the federal government's strategy to strengthen domestic industrial capabilities, expand electromobility, and increase local content across the automotive supply chain.

The announcement was made during a press conference at the National Palace in Mexico City attended by Mexican President Claudia Sheinbaum, Minister of Economy Marcelo Ebrard, and senior executives from Kia Mexico.

"In an era of such uncertainty regarding the automotive industry, tariffs, new rules, and so on, the fact that this decision is being made means that this company, which is one of the most important in the world, is experiencing productivity in Mexico and sees opportunities, investment, technology, jobs, and economic activity in the country," Ebrard said.

The investment comes amid heightened geopolitical and trade uncertainty across North American. Regional automakers continue to face evolving regulations, ongoing discussions surrounding the USMCA review, and US sectoral tariffs. 

Workforce Expansion and Supply Chain Localization

The multi-year investment program will generate new employment opportunities at Kia's Pesqueria facility. According to Ebrard, the new EV3 production line will create 500 direct jobs in 2026, followed by an additional 1,500 direct positions between 2027 and 2030.

Beyond expanding assembly capacity, the project also focuses on strengthening the domestic supply chain. The EV3 will initially launch with 27% local content, a figure that both Kia and the Mexican government intend to increase throughout the investment period.

"This is a priority objective of Plan México: increasing national content—that is, what is produced in Mexico. It expands production opportunities for our country's automotive industry," Ebrard said. He added that the EV3 will be manufactured for both the domestic market and export destinations, positioning the Pesquería plant as a regional production hub serving Latin America.

Young Sam Kim, President and CEO, Kia Mexico—also known as Andy Kim—reaffirmed the company's long-term commitment to the country. "Today I reaffirm our promise: Kia Mexico will be your most strategic and reliable partner in making shared prosperity a reality. We have grown hand in hand with the Mexican economy," Kim said.

Charging Infrastructure and EV Ecosystem

The investment package extends past vehicle assembly to establish a broader commercial and infrastructural ecosystem for electric vehicles across the domestic market.

"For the first time in our history, we will produce and commercialize an all-electric vehicle in Mexico. This commitment materializes with the Kia EV3, which will be proudly made in Mexico," said Horacio Chavez, Commercial Director, Kia Mexico.

Chavez explained that building consumer adoption requires addressing charging infrastructure and operational support services. The company's rollout plan includes:

• The deployment of residential and public charging solutions across key urban and highway corridors.
• Dedicated specialized assistance services for electric vehicle owners.
• Vehicle-to-vehicle (V2V) mobile charging units designed to offer emergency battery replenishment for stranded drivers.

President Sheinbaum highlighted the project's dual impact: expanding domestic manufacturing while strengthening Mexico's charging infrastructure.

"The investment per se shows confidence in our country, and the second aspect is the push toward electromobility, which means the production of an electric vehicle and the network of charging stations to power these vehicles. So, it is very, very good news," Sheinbaum said.

Sustainability and Renewable Energy Investments

As part of the US$649 million investment, Kia will also finance environmental projects within its Nuevo Leon manufacturing complex aimed at reducing carbon emissions and water consumption.

Marianela Calderón, Administrative Director, Kia Mexico, outlined two of the project's key sustainability initiatives:

• Solar Generation: Construction is underway on an initial 2-megawatt solar farm, with plans to expand its capacity to 8 megawatts by 2030. Once fully operational, the solar installation will produce electricity equivalent to the annual energy consumption of more than 4,000 Mexican households.
• Water Recycling: Kia is constructing a second wastewater treatment plant at the Pesquería complex. The unit will treat and recycle approximately 1,050 m3 of industrial water daily, reclaiming roughly 70% of the treated water utilized by the assembly plant. This recycled volume matches the daily water usage of more than 2,000 homes.

Macroeconomic Context and Bilateral Relations

The investment lands as Mexico positions itself within global trade flows and capital relocation trends. Economy Ministry officials reported that Mexico’s active investment portfolio comprises 1,186 projects valued at US$404 billion in various planning and operational stages.

Ximena Escobedo, Undersecretary of Industry and Commerce, Ministry of Economy, noted that the government is accelerating regulatory processes to support foreign direct investment. Working alongside the Investment Office of the Presidency, 13 priority projects across the energy and telecommunications sectors have recently received immediate administrative authorization.

The deal also underscores deepening economic ties between Mexico and South Korea. South Korea remains one of Mexico's principal Asian trading partners and sources of foreign investment, with more than 2,000 South Korean firms operating within Mexican borders.

The manufacturing commitment follows top-level diplomatic engagements, coming two months after a bilateral telephone call between President Sheinbaum and South Korean President Lee Jae Myung, in which both heads of state agreed to expand commercial, economic, and industrial cooperation between the two nations.