Coahuila in Mexico is attracting increasing levels of FDI. Credit: Brenda Rocha – Blossom via Shutterstock.

China-based die-casting company Xusheng has begun the construction of a plant in the state of Coahuila, Mexico.

The new plant will be located in the Alianza Derramadero Industrial Park near Saltillo, Coahuila’s capital and largest city, and will produce aluminium alloy auto parts for the automotive and e-mobility sectors, according to Cluster Industrial.

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First announced in May 2023, the die-casting plant will be one of North America’s largest aluminium component manufacturing hubs, leading to the creation of 1,200 jobs at the time of its opening. In April this year, the Chinese company said it planned to invest $276m (2.02bn yuan) in five new subsidiaries in Hong Kong, the UK and Mexico.

The subsidiaries will help support the construction of Xusheng’s factory in Mexico, which is intended to scale up its business activities in North America.

“Today, Coahuila is experiencing high industrial dynamism with the arrival of new and greater productive investments, which unite our supply chain and diversify the origins of capital,” said Governor Miguel Ángel Riquelme Solís, at the ground-breaking ceremony attended by Cloud Zhao, vice-president of Xusheng Group.

Investors have long seen the manufacturing industry as one of the most thriving in Mexico. In 2022, approximately 36% of foreign direct investment inflows – or around $12.71bn – went into manufacturing, according to the Mexican Ministry of Economy, above transportation in second place with 15.1%, or $5.33bn.

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Xusheng is one of many foreign companies to announce that it is setting foot in the Latin American country. In June 2023, Irish automotive technology supplier Aptiv announced plans to invest $40m in a new manufacturing plant in El Salto, a city in the Mexican state of Jalisco, promising to create 2,200 new jobs in the region.