Just weeks after Mazda Motor Co. announces that it will stop building the Mazda6 sedan at the Flat Rock factory in Michigan once this current model’s life cycle ends, the company is now announcing the building of engine and vehicle assembly plants in

Mexico to make small cars.

The Japanese automaker said June 6 that it will build the next Mazda6 version at Mazda's Hofu plant in Japan due to the yen’s value in relation to U.S. dollars. The new assembly plants are set to be built in Salamanca city, Guanajuato state, north of Mexico City, in an alliance with trading company Sumitomo Corp. Yahoo News’ report said, “They will manufacture the Mazda2 subcompact and Mazda3 compact, primarily for Central and South America, the company said. The factory complex is aimed at increasing Mazda's presence in Brazil, which has become the world's fourth-largest auto market after China, the United States and Japan, the company said.” Mazda has seen record sales volume and market share in Mexico last year, and has done well since entering the Mexico market in October of 2005.

The article reported, “The $500 million factory complex in Mexico is scheduled to open sometime after April 2013 and have an annual production capacity of 140,000 vehicles. It will employ about 3,000 people when at full capacity.

Mazda also said it will start a Brazilian sales company sometime between April of next year and March of 2013, selling vehicles produced in Japan until the Mexican plant starts operating.

Mazda will own 70 percent of the factory complex and the Brazilian sales company, while Sumitomo will own 30 percent, the statement said.

The partnership announcement comes as Ford continues to cut its stake in Mazda. Ford bought 25 percent of the struggling Japanese carmaker in 1979, raising it to 33.4 percent in 1996. But Ford began cutting ties in 2008, when it was trying to cut brands and costs. Last year, Ford lowered its ownership to 3.5 percent.”

Mazda's announcement about stopping production at the Michigan plant raised questions about the future of a U.S. factory that it runs jointly with Ford Motor Co. Mazda has not said if Mazda will pull out of the joint venture, Auto Alliance International.

Source: Yahoo News