"Ford Motor Co. will build a new assembly plant in Mexico and sharply increase factory output from that country, representing the latest shift of investment abroad by a Detroit auto maker following the signing of a costly new labor deal.
The No. 2 light-vehicle seller in the U.S. plans to add 500,000 units of annual Mexican capacity starting in 2018, more than double what it built in 2015, according to people briefed on the plan. The plan mirrors General Motors Co. ’s $5 billion investment to double Mexican capacity by 2018.
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Detroit auto makers have long built cars and trucks in Mexico, but the country is looking more attractive following a new labor deal struck in November with the United Auto Workers that raises wages for U.S. factory workers. Labor rates in Mexico are roughly one-fifth of those earned by unionized workers in the U.S., a gap that is only expected to widen as UAW wages approach nearly $30 an hour in coming years, representing as much as a $10 increase for some newer hires.
Auto factories in Mexico produced 3.4 million vehicles last year, or about one-fifth of North American production, according to LMC Automotive. "
http://www.wsj.com/articles/ford-to-more-than-double-mexico-production-capacity-in-2018-1454857923
