US tire maker Goodyear will build a half-billion-dollar factory in central Mexico that will produce six million tires a year for customers across the Americas, the company said Friday.
Goodyear is the third auto sector company to make a major announcement in Mexico since last week, following a $1 billion investment by Japanese giant Toyota and a $2.5 billion project by US automaker Ford.
The tire plant will be built in the state of San Luis Potosi and will begin production in mid-2017, chief executive Richard Kramer said at a ceremony alongside Mexican President Enrique Pena Nieto in the country's capital.
The investment will cost between $500 million and $550 million and employ around 1,000 people. The company plans to break ground in June.
"In addition to supplying tires to our customers in Mexico, the plant's geographic location will enable us to export tires to both Latin America and North America as well," Kramer said.
Mexico's proximity to the world's biggest market, the United States, its relatively cheap and skilled labor, and its free trade agreements with several nations have made it an attractive destination for investors.
The country overtook Brazil last year to become the top producer of vehicles in Latin America and the seventh biggest in the world. It is the fourth largest exporter in the globe.
Mexico is also the fifth biggest producer of auto parts in the world, and it holds 33 percent of the market in North America, Economy Minister Ildefonso Guajardo said.
Since Pena Nieto took office in December 2012, the country has announced or inaugurated $17.2 billion worth of vehicle-making factories and $6 billion in plants for auto parts, Guajardo said.
Pena Nieto, who has sought to focus international attention on Mexico's economic potential instead of its drug violence, said his country is "consolidating as a trustworthy destination to invest in."