On the Dash:
- Kia will invest $649 million to build the EV3 at its Nuevo Leon plant starting Aug. 4.
- The move expands Kia’s U.S. EV lineup as other automakers pull back on electric plans.
- Mexico is courting foreign automakers amid U.S. proposals to tighten North American content rules.
Kia will invest $649 million to bring electric vehicle production to Mexico. Horacio Chavez, Managing Director for Kia, announced the investment Wednesday during President Claudia Sheinbaum’s daily press conference.
The EV3 is currently built in South Korea, but production will shift to a Kia plant in the Mexican state of Nuevo Leon starting Aug. 4, Economy Minister Marcelo Ebrard said.
A significant portion of the domestically produced EV3 is intended for the Mexican market, as the government pushes to grow EV adoption in the country, Sheinbaum said.
The move comes as Kia expands its EV lineup in the U.S. even as other automakers scale back their electric plans. Notably, the 2027 EV3 is set to go on sale in the U.S. later this year with five trims.
The investment also comes as Mexico looks to diversify its trade relationships. The country is bringing in new technologies, including Kia’s batteries and electric vehicles, to reduce imports amid growing protectionism from the United States, its largest trading partner, according to Reuters.
The U.S. proposed during bilateral USMCA talks with Mexico in May that 50% of the value of North American-built vehicles originate in the United States, a significant departure from current trade rules requiring 75% North American content.
Automakers including Toyota and General Motors have already announced plans to expand U.S. capacity and shift some vehicle production stateside. Toyota is moving some Tacoma production from Mexico to Texas by 2030, a decision that illustrates how trade uncertainty is shaping automaker manufacturing strategy.
