By on June 9, 2014

2014-kia-forte-5-door-rear-left-view

In light of high demand in the United States for its offerings, Kia will build its first Mexican plant in Monterrey to help bring additional capacity to North America.

Reuters reports the factory will open 21 months after groundbreaking, supplying a total of 300,000 vehicles annually to the United States. Production will focus on Kia’s compacts — the Forte and Rio — at first before taking on work from the brand’s sole U.S. factory in Georgia, where the Optima, Sorento and Hyundai Santa Fe are assembled, and from Hyundai’s Alabama plant, where the Sonata and Elantra are built. No word was given on when the first shovels would break the earth.

Aside from supply-and-demand issues in the U.S., Kia is likely building the Monterrey plant — to go with Hyundai’s production expansion into Chongqing, China — in order to maintain its market share around the globe. The duo together hold fifth place in the global auto sales race, a position it could lose by 2016 if no more capacity is added, according to Korea Investment & Securities auto analyst Suh Sung-moon.

The capacity limit was unofficially put in place by Hyundai/Kia chair Chung Mong-koo over two years ago, fearing his two brands would end up like Toyota in the 2000s if they expanded as aggressively as had the Japanese automaker.

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24 Comments on “Kia Building First Mexican Plant To Alleviate Strained U.S. Production...”


  • avatar
    geozinger

    If I were tasked with determining where an assembly plant would go to service the Americas, Mexico (domestic problems aside) would be my first choice. Access to NAFTA and not that far from the South American markets makes it a very logical choice. But, that has been my opinion for a long time now. I suspect that Mexico will become an auto manufacturing powerhouse, more than China potentially.

    As an aside, I’m really starting to warm up to Kia’s lineup of cars. Next time around, I may buy outside of the “family” for the first time in a long time…

  • avatar

    Can someone please post a short list of very popular car models being produced in America?

    • 0 avatar
      bumpy ii

      In these United States are built:

      Camry
      Accord
      Civic
      Altima
      Fusion
      Sonata
      Cruze

      maybe the Corolla, I don’t remember off the top of my head if Toyota started up Mississippi production yet

      • 0 avatar
        bd2

        Optima, Passat, Elantra, Jetta, Legacy, Impala, Malibu, etc.

        And GM is the only one to produce both its compact (Cruze) and subcompact (Sonic) in the US.

        The majority of Fusion production is in Mexico, as is production of the Fiesta.

    • 0 avatar
      VoGo

      define America.
      -US only?
      -Include Canada?
      -NAFTA?
      -Both continents?

      • 0 avatar

        “define America”

        The conspiracy theory is that the Globalists are trying to make Mexico, America and Canada into one country – and crash the US DOLLAR – in order to create “The Amero” (like Euro).

        As far as I know, America is defined as the United States, although I see Canada as part of America…

        …but definitely not Mexico.

        • 0 avatar
          CoreyDL

          I do believe Mr. George W. Bush put the first of the machinations toward the Amero into effect. It’s not a theory.

          • 0 avatar
            highdesertcat

            CoreyDL, actually, IIRC it was President Reagan. It’s too deep a subject to go into here, but if anyone knows more about this, please word up.

            During Bush, The Elder, trade was enhanced with Mexico, Central and South America. In MY area we saw a lot of imports from South of the Border, like prepared foods, gasoline, oil, beef, fruits, vegetables, etc.

            During Clinton, it was a heyday for international trade, especially with NAFTA opening up the borders to truck drivers from Central and South America.

            Boy, did the Teamsters have an apoplectic fit about that! The Teamsters claimed that the foreign truckers and their trucks were unsafe for US roads.

            Never mind that the foreign truckers had to face more scrutiny in getting an International CDL, and that their trucks were newer, most often AMERICAN MADE Peterbilt, Volvo, Kenworth, and the like , depending on which American Freight company they chose to work within the US.

            Many Mexican/South American trucking companies switched to the Mercedes-Benz and M-A-N tractors, that were the standard of international trucking in Europe, the Middle East, Asia, and South Asia, as these tractors were recognized for their reliability, durability and safety, unlike the American tractors that could not pass safety requirements in Europe and the rest of the world.

          • 0 avatar
            Big Al from Oz

            @HDC
            I do think your correct about the trucks.

            We have trucks from every continent that run here.

            The US trucks are actually made in Australia to meet our standards.

            Our ‘NA’ trucks seem to sit higher as well.

            We run many Euro trucks. The Euro trucks are even starting to become very powerful trucks, pulling road trains up where I live.

            These trucks are far larger than what is used in NA for freight.

            We tend to have more cab over trucks here, which are Asian and Euro.

            Most of NA style trucks are long nose.

            US style trucks.

            http://images6.alphacoders.com/423/423301.jpg

            http://upload.wikimedia.org/wikipedia/commons/d/df/Road_Train_Australia.jpg

            http://2downunder.files.wordpress.com/2013/05/roadtrain-mit-4-hc3a4ngern.jpg

            http://www.allfreightconnect.com.au/edit/vehicle_images/ROAD%20TRAIN.JPG

            Euro

            http://upload.wikimedia.org/wikipedia/commons/1/11/Road_Train2.jpg

            http://www.wallpaperbod.com/wp-content/uploads/2013/03/Mclatent-Actros-V-Road-Train-.jpg

            A ‘B Triple’ Scania. B Triples are used on the East Coast, ie, Sydney, Adelaide, Melbourne and Brisbane. They are smaller.

            http://www.newtrucksearch.com.au/media/6204872/scaniastreamliner730_500x300.jpg

            Asian trucks other than Izuzu don’t really come into the heavy side of trucking.

            Some Asian prime movers pull trailers around inner city areas. Other than that I don’t see any Asian prime movers other than Izuzu.

          • 0 avatar
            highdesertcat

            BAFO, what we call road trains in the US, on only select roads, consist of only 3 – 20ft trailers, and are no match for the real road trains down under.

            Then again, America was built by the railroads, in a different chapter of America’s development.

            US-style heavy trucks serve America well, but for some odd reason, cannot meet the safety standards of the Europe mainland, or the Lorry standard of England. I don’t know why that is, but have often wondered.

            But the other way around, I have been seeing more and more Europe-made buses and tractor trucks on America’s roads, and they costs significantly more than what’s made in the US or Canada.

            They are easily distinguishable from the rugged but dated looking American mainstays of HD trucking and busing.

            The American-built, Volvo-designed tractor has been my personal favorite because of its smoothness and cab accoutrement.

            For really heavy duty tractors, I can’t think of anything more fitting than the tractors from F.W.D although Diamond R.E.O. was quite sturdy AND reliable in its day.

            We used to haul flatbeds stacked with palletized bombs to the flightline behind Mack trucks and Diamond REO tractors, in Viet Nam in 1967.

            The US Army uses the FWD to haul its 70-ton M-1 Abrahms Main Battle Tank to/from the Combat Range in the desert not far from my house.

            These days, if I need to haul something that requires a tractor trailer, I rent from Ryder. Most of the time in the past that has been a Volvo.

            It has been my experience that Ryder has the best maintained fleet. Their rentals are ALWAYS clean, smell good, and come with two full tanks of diesel.

            Now that KIA has decided to build in Mexico, that will directly affect the International transportation hub in Santa Teresa, NM. So I see this move as a good thing.

            And……. there won’t be any whining from the UAW about KIA building cars in Montgomery or elsewhere in the US, and not being unionized! That’s a plus.

            Hats off to KIA!

          • 0 avatar
            Big Al from Oz

            @HDC
            Talking about ‘hubs’ for transportation, these are going to be significant centres in the future.

            Look at aviation how certain airports will die in the ass as aircraft get better endurance. New centre will rise and old centres will die as we move forward (sort of like Detroit).

            The place I was posted to last was earmarked to become the logistics hub between Sydney, Melbourne, Adelaide and Brisbane.

            The city (small) is already a trucking centre, but the government wants to develop it into a rail centre between all the major centres on the east of Australia.

            The place is sort of booming.

            Industry will set up as well as many logistics operaations.

            Good for real estate. Built a house there.

          • 0 avatar
            highdesertcat

            BAFO, in MY part of the US, things are changing rapidly for the better ever since NAFTA has come into being.

            For us, the people of this region, NAFTA has been the best thing since sliced bread! Any expansion of production into Mexico is a boon to us in this area in so many ways.

            Along with many other developments a new transportation hub has been built at Santa Teresa to augment the enormous hub located in nearby El Paso, TX.

            These complexes are HUGE! And they cause enormous spin-off projects like Solar farms in the desert, adding lanes and toll roads to the network of arteries funneling traffic, a building boom, etc.

            People moving in from all corners of the USA to seek work in this expansion boom.

            Yes, that is great for real estate. My wife and her dad bought a house in West El Paso, TX, for my daughter, when she moved there from LA, but we have no plans to buy more. Housing demand and prices are both up. Now’s the time to sell, not buy.

            In fact, my father-in-law wants to sell as many houses as the business can, before the end of this year, so he and his wife can retire at age 88. Turn over the rest to his four daughters, with my wife, the eldest, in charge.

            They’re doing very well in this sales effort, but only because demand for pre-owned housing is so strong at this time for the homes in the price range he is selling.

            Lots of people moving here from both the East and West coasts of the US, all trying to get away from the higher taxes and the higher cost of living in those areas.

            So 2014 is going to be a very busy year for us. It already has been busy but since we jacked up the cost of the rents of the rental properties in anticipation of the higher minimum wage mandates in the US, many of the tenants can no longer afford it and are moving out, moving downscale into Mobile Homes (Trailers), leaving us free to renovate, update and sell those properties.

            It’s time to cash out, and for us, now is the ideal time. No buying. Just selling. Divesting. Retrenching.

          • 0 avatar
            DenverMike

            @HDC – “…for some odd reason, cannot meet the safety standards of the Europe mainland, or the Lorry standard of England. I don’t know why that is, but have often wondered.”

            I’m really surprised BAFO forgot to mention the 22% tariff Europe slaps on US made trucks. Otherwise, standards between the regions are similar enough.

        • 0 avatar
          ISCH

          AMERICA: continent( including SOUTH AMERICA, NORTH AMERICA AND CENTRAL AMERICA), NORTH AMERICA: USA; MEXICO and CANADA.
          UNITED STATES : COUNTRY.

  • avatar
    CoreyDL

    They won’t strain for the new K900. Saw one yesterday in the flesh at a concours show, and it looked rubbish. The interior was -ok- I suppose, but the 8 squares of headlights and tiger mouth at the front really throw it off.

  • avatar
    darex

    I don’t know if the article explains why I haven’t been able to buy a Kia Forte5 SX with both packages and manual-transmission until MAYBE next month, for the first time since they were announced 15 months ago, and from when it SUPPOSEDLY went on-sale, 7 months ago.

    Too late for Kia, though. I have given up and just bought a MINI Cooper F56 instead.

    I don’t honestly know what Kia’s problem is/was, but my patience only goes so far. Haven’t said that, The Forte is a great car, and nothing can touch it for content. I much preferred it to the Mazda3.

    • 0 avatar
      SC5door

      The local dealer had one (SX 5 door 6 speed with everything)…and it went quickly. Same color as the unit shown in the photo above. I went back to take a second look and they sold it within 24 hours of being offloaded from the truck.

      From what I understand:

      1. The don’t produce that many Forte 5′s
      2. Gets put on a ship and then shipped to Tacoma
      3. Gets distributed across the states

      I was able to follow my paperwork back and mine was produced 6 months before it landed at the dealer. Although a quick search of Autotrader shows a decent amount, I would have checked elsewhere.

      • 0 avatar
        darex

        That’s the thing: ALL (all 5!?) Forte5 SXs with manual and both packages went to the Western Region, and not one has yet shipped to the Eastern Region, and any that do now, will be 2015s. Not one 2014 ever made it east.

        Their allocation system is non-existent. Dealers cannot order one, and KIA USA has zero control over what’s made.

        It is one messed-up system!

    • 0 avatar
      bd2

      Tight supply of the Forte overall which is why sales have been capped around 7-8k a month.

      Same thing happened to the Optima until US production started at Kia’s GA plant.

      Kia also probably wants to increase Optima and Sorento production for the next gen models but producing the Santa Fe Sport for Hyundai really impinges on their ability to do so.

  • avatar
    darex

    Some have suggested that Hyundai dealers demanded that Forte supply be limited because it was killing Elantra sales, until the 2014 Elantra’s engine upgrade. It’s as hood an explanation as any.


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