Mazda Motor Corporation has signed formal agreements and begun preparations to establish a Mazda vehicle production facility in Mexico and a sales company in Brazil, in alliance with Sumitomo Corporation. Through the new joint ventures, Mazda and Sumitomo intend to combine their individual strengths in order to enhance both companies’ business in the rapidly growing Central and South American markets.
Mazda will hold 70% of both the production plant and the sales company; Sumitomo will hold 30% of each.
The Mexico production facility will be established as a compact vehicle manufacturing hub mainly for Central and South America, and will include both vehicle and engine assembly plants. It will be constructed in Salamanca city, Guanajuato state, 250 kilometers northwest of Mexico City. Mazda and Sumitomo plan to commence operations in the fiscal year 2013 (April 2013 to March 2014) with an annual production capacity of 140,000 units. The facility will produce Mazda2 (Mazda Demio in Japan) and Mazda3 (Mazda Axela in Japan) models.
The Brazilian sales company will begin operations in the fiscal year 2012 (April 2012 to March 2013), before the production plant in Mexico is completed, and will initially sell vehicles imported from Japan. When the Mexico facility becomes operational, it will also sell vehicles shipped from Mexico.
Between 2005 and 2010, new car demand in Brazil doubled to approximately 3.5 million units. Currently, Brazil is the world’s fourth largest automobile market following China, the United States and Japan.