Volkswagen Puebla Expansion

Not long after Volkswagen’s 50th anniversary in Mexico and the last US$700 million expansion for the production of the Volkswagen Golf VII, on March 9th, 2015, the company announced a new US$1 billion expansion of its plant in Puebla. This 90,000m2 project will include new logistic spaces, as well as a new industrial facility for body-exterior construction. Additionally, the projected infrastructure includes the modernization of the existing facilities, and the introduction of state-of-the-art technology for the manufacturing process and the final product. The combination of all these factors will allow for a total daily production of 500 units. While some of these units will remain in Mexico, the rest will be shipped to several markets in North and South America. Joining the Golf VII, the Jetta 4 and 6, and the Beetle Coupe and Cabriolet, the new production line will be dedicated to the latest version of the Volkswagen Tiguan. According to Andreas Hinrichs, CEO of Volkswagen de México, the line will start operations in 2016, and the new Tiguan will be available on the market by early 2017. Just as the Golf VII, the Tiguan will use Volkswagen’s Modular Transvers Matrix platform MQB, easing the transition process of this new model into the plant.

With a combined total of 3 million m2, Volkswagen’s plant in Puebla is the largest manufacturing complex in Mexico and one of the largest plants of the Volkswagen Group. It includes all the processes needed for vehicle fabrication, including stamping, painting, assembly, as well as production of engines, axles, and catalytic converters. Previously, the plant employed 15,800 people, but it is now expected to generate an additional 2,000 direct jobs. The new industrial facilities and assembly lines will also increase business for auto parts suppliers around the country, as well as bring new investments for these suppliers’ own facilities. During the official announcement, Francisco González, Director General of ProMéxico, stated that this expansion would bring an estimated US$1 billion in annual auto parts requirements. In response to these new developments, the local government is constructing new roads and highways, easing the transport of people and resources into the facilities.

The new Tiguan production will also be in line with Volkswagen’s Think Blue. factory strategy, and its goals of reducing environmental impact in all manufacturing facilities by at least 25%. The new facility will have the most advanced systems for water and energy consumption, similar to other Volkswagen facilities built in recent years. Through this investment, and with Audi’s upcoming production plant, the Volkswagen Group is steadily growing its presence in the country, and it is now consolidating Puebla as one of the largest automotive clusters in Mexico.