German automotive parts maker Continental AG said on Monday it will invest around 60 million euros ($72 million) in expanding a plant in the central Mexican state of San Luis Potosi.
In a statement, the company said it would manufacture brake parts in the 20,000 square meters of new production space.
($1 = 0.8304 euros)
“The decision to locate the manufacturing of these high-tech components at the San Luis Potosi plant is a strong sign of Continental’s confidence in Mexico and especially in the region,” plant manager Victor Hernandez said.
The expansion of the plant, which is scheduled for completion in October 2022, is welcome news for Mexican President Andres Manuel Lopez Obrador, whose unorthodox economic policies have spooked investors.
It also comes as Mexico’s economy recovers from its worst recession last year in almost 90 years and Lopez Obrador hopes the new United States-Mexico-Canada Agreement (USMCA) trade deal spurs new investments and jobs.
Continental said the expansion would create some 350 new jobs over the next three years, on top of the 650 people already employed at the San Luis Potosi plant.