By on April 18, 2012

Just as we predicted, Audi has chosen Mexico as the site of their newest manufacturing plant. A specific site for the plant will be selected later in the year, with production of an unnamed SUV (said to be the Q5) starting in 2016.

While rivals such as Mercedes-Benz and BMW, Audi chose Mexico to capitalize on South America’s growing market (specifically Brazil) and to avoid a 10 percent duty levied against American built cars imported to Europe. Volkswagen was apparently pushing for their Chattanooga, Tennesse plant to stay close to suppliers and for marketing reasons (how about a “Made in America” Audi?).

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19 Comments on “Audi Picks Mexico For New Plant...”


  • avatar
    Mark MacInnis

    Well, I ‘spose their cost accountants did a labor-cost-per-hour vs. cost of kidnap insurance analysis and spun the numbers so it came out favorable to the US…

    My company has plants in May-hee-co, and frankly the cost of security and the worry to the families of our executives who travel there are a massive PITA….

    They’ll be armoring up some Q7′s to tranport the execs around, f’certain….

  • avatar
    Sundowner

    I’m a little worried that the bean counters at Audi won out again over the marketing department on this one (do the engineers ever get a say anymore?). To shy away from a grat marketing tag like “made in the USA” seems like folly to me. If VW proper didn’t see value to the concept, Passats would be madein Puebla instead of Tennesee right now.

  • avatar
    threeer

    What?? An Audi built in Mexico? Boy, I tell ya, these days it’s getting harder and harder to tell which country a car comes from…oh, wait a minute…

  • avatar
    onthercks07

    Looks like Mexico is solidifying its position in the world. Mexico=corruption, bodies and body parts, weed, meth, horrible hangover-inducing alcohol, and cheap auto manufacturing

  • avatar
    onyxtape

    Doesn’t make sense – now they’ll have to ship the VWs from Tennessee all the way down to Mexico before installing the leather seats.

    (Ducks)

  • avatar
    Speed Spaniel

    BAD move. At least it’s a product in their line-up I would never consider buying. Girly girly crossovers don’t do a thing for me.

  • avatar
    CJinSD

    Anyone know the origin of the 10% tariff on US produced cars sold in Europe? You’d think that Mercedes or BMW would have had it eliminated by now.

  • avatar
    NormSV650

    I whole they drip the same taco sauce they spilled in my friend’s HHR. Tons of electrical glitches.

  • avatar
    johnhender

    Audi’s built in Germany are bad enough.They are great to look and drive- But there is very rarly a day when everything is working all at once on the same day. I would be scared to buy an Mexican Audi, who would have thought a German Audi built in Mexico I am glad my current Audi will likely be My last. the maintinance is Epic the prices go in $500.00 increments and i am tired of it.A lexus may be boring but they dont break should have done what my customers have done replaced all their German cars with lexus Why would i want to pay German prices for a Mexican vehicle?
    My new Can AM was built in Mexico loose stuff everywhere i basically have to take it apart and rebuild it before i can race it which really sucks

  • avatar
    Good ole dayz

    Consider that it may be a political calculation. The VW plant in TN was baked in the cake before the UAW-GM-Chrsler taxpayer bailout.

    But seeing how the Obama administration treated the “secured” bondholders in order to give preferential treatment to the UAW (arguably unlawfully, i.e., it would be if they weren’t the ones also deciding what is / isn’t legal) — and screwed the taxpayers in order to hand the UAW a big ownership interest in GM and Chrysler to the UAW (again arguably unlawfully) — would you be inclined to invest hundreds of millions of dollars in a new auto plant in the present Obanana-republic?????

    • 0 avatar
      fastr_thanu83

      how exactly are the taxpayers screwed??? I never read once that GM was never going to pay back loan???? I personally would rather have the UAW run the companies that a bunch of wealthy CEOs running the companies, and then outsourcing the jobs, thus adding more people to the unemployment line, more people applying for welfare (both are funded with tax payer money). If GM and Chrysler went under it would have been a domino effect 100s of 1000s of jobs would have been lost welfare and unemployment would have been though the roof. In reality in the last sceneo that would have costed the tax payers more money, and in some way or another that effect could affect a friend or family member of yours

      • 0 avatar
        Good ole dayz

        1) Bush is also to blame, he started the bailout. That said, he wouldn’t have upended bankruptcy law in order to enrich the UAW (which had a major, if not the major hand in causing the problem in the first place).

        2) The Treasury right now is showing a paper loss of 10-15 billion on the stock that it got, and more importantly, the tax-loss carryforward that the “new GM” was allowed to inherit from the “old GM” (contra to existing bankruptcy law) gave it a $40 billion “loss” to offset taxes. That’s a taxpayer giveaway / subsidy placed under the cover of the faux bankruptcy, and by definition those taxes will never be paid, so the taxpayers will never recoup that money. So that loss will stay no matter what occurs with the stock.

        3) The spin that GM / Chrysler would have dissolved and caused massive job loss and huge increases in unemployment / welfare costs is just that, spin. For one thing, even for the sake of argument to assume the dissolution of GM/ Chrysler that you suppose, people will still buy vehicles, and they’d have been manufactured by Americans at the non-UAW plants around the country, which would have hired more people to meet the demand.

        And the feds could have offered to guarantee “debtor in possession” financing, which would have permitted them to go through a genuine Chapter 11 reorganization (instead of the politicized sham pre-packaged one).

        The difference is that with a genuine reorganization the UAW pensions would have been gone, their contracts rewritten and work rules adjusted to market realities. It was to avoid this that prompted the Obama administration to protect the UAW through extra-legal means.

        The result is that the domestic manufacturers are still saddled with UAW contracts and legacy costs, meaning that they still aren’t competitive and are going to be back at the taxpayers door one of these days, looking for another bailout.

        Also, how much have the taxpayers incurred to “save” each of the jobs allegedly saved? Tens of billions of dollars probably equates to hundreds of thousands, if not millions, per job.

        As said, the taxpayer were, are and will continue to be screwed by the bailouts.

    • 0 avatar
      pgcooldad

      How did things work out during the Bush-republic? Not so well now did was it? Oh, except for the “bail out” George Bush extended to GM and Chrysler in December of ’08 without a clue as to how to actually help these companies out. Matter-of-fact, Bush was so successful that Republican Presidential candidates are clamoring for his endorsement; or begging him not to speak their name? I suspect the later.

      http://www.politico.com/news/stories/1208/16740.html

      I apologize for extending Good Ole’s political rant but at this time I would like to thank the Honorable George W. Bush for so kindly putting so many American jobs first instead of political ideology, and given the choice would do it again. Now about those WMD’s, I don’t think we even found a Super Soaker hidden in a warehouse anywhere in Iraq.

    • 0 avatar
      fastr_thanu83

      I can see you have this hatred about the UAW, you are very misimformed about the unions. Try working in a GM factory, its not that easy the myths of people playing cards, drinking on the job pressing a button all day skipping work, are all myths. Try working at a assembly plant, I bet you couldnt do it, sure you may think putting a taillight in a vehicle is all you do, however you have to route the harness install at least 2-3 bulbs fasten the bulb into the lamp assembly, install the assembly onto the vehicle, the fasten the screws, or reach in fasten the nuts on the stud. Sounds easy????? you have to do 4 minute. In the summer time the temp get to 110-125 degrees inside, cant wear shorts. And if you work at the foundry its even worse. Or howabout the motor line installing exhaust manifolds, you got 6 of those a minute. Work in a assembly plant and tell me you dont need a union, I could go on and tell you more. Bottom line is there isnt any cake jobs. So what is the problem with the UAW owning stake into the companies? Better than a bunch of fatcat rich guys owning it.

  • avatar
    OldandSlow

    Seriously, I would have chosen Canada over Mexico to build an assembly plant for a premium brand.

    In the long term, Canada is a much more stable place to operate a business. Mexico on the other hand is a security nightmare.

  • avatar
    lon888

    When the narco-terrorists start shooting big holes in their plant and their execs start getting kidnapped, they’d wish they chose the US.

  • avatar
    VinceY

    How does Audi building a plant in Mexico help them to “avoid 10 percent duty levied against American built cars imported to Europe” and “While rivals such as Mercedes-Benz and BMW…” What are they doing exactly? I am really confused.


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