MEXICO CITY (AFP) - The Ford Motor Company unveiled Friday a US$2.5 billion (S$3.3 billion) investment for engine and transmission plants in Mexico, the second major project announced in the country by a foreign auto power this week.
The US firm's plan to expand an engine plant in the northern border state of Chihuahua and build a transmissions factory in the central state of Guanajuato will create 3,800 jobs, the company said.
The investment was announced by Ford's president for the Americas region, Joseph Hinrichs, and President Enrique Pena Nieto at the Mexican leader's official residence in Mexico City.
Just two days earlier, Pena Nieto had invited Toyota executives to his residence for the Japanese auto giant's announcement that it was ending a new plant freeze with a US$1 billion factory in Guanajuato to produce the Corolla sedan.
The back-to-back announcements "prove to the world that Mexico has conditions for competitiveness, conditions to be more productive and conditions to attract more investments," Pena Nieto said.
"This makes the world turn to look at Mexico," he said. "In the auto sector, Mexico is a world power."
Mexico overtook Brazil to become the world's seventh biggest auto producer last year. It also surpassed Japan as the top exporter of vehicles to the United States.
Economy Minister Ildefonso Guajardo said that, since Pena Nieto took office in December 2012, the government has announced US$22.6 billion in auto sector investments.
Ford said the new US$1.1 billion gasoline-powered engine facility will be built within Ford's plant in the northern border state of Chihuahua to boost engine exports to the United States, Canada, South America and the Asia-Pacific region.
The company will also spend US$200 million to expand the Chihuahua plant's production of I-4 and diesel engines, he said, turning the facility into the biggest engine plant in Mexico.
The new US$1.2 billion transmission plant will be built on the premises of Ford supplier Getrag in the city of Irapuato, Guanajuato.
"This new plant - Ford's first transmission facility in Mexico - will produce two all-new automatic transmissions for key products primarily in South America, Europe and Asia-Pacific as well as other North American markets," the company said in a statement.