German car manufacturer BMW is reported to be planning to build its first assembly plant in Mexico and has so far earmarked two possible sites, said German magazine Automobilwoche, without disclosing the source.
A spokesman for the company said there is no decision yet to build a new factory in the North American Free Trade Agreement area that includes the US, Canada and Mexico.
It is speculated that the announcement will be made by the company in July.
"We're routinely looking at different locations," the spokesman said.
The story goes that BMW's Mexican factory will be built in either the state of Hidalgo or in San Luis Potosi and will initially produce up to 100,000 cars per year. Likely car models include the 3-Series saloon, said Reuters.
The rumours come as numerous free trade accords, a cheap and able labour force and proximity to the lucrative US auto market, keeps attracting investment by foreign carmakers, such as Audi and Honda, to Mexico.
BMW said in March that it will ramp up annual production capacity at its US factory in South Carolina to 450,000 vehicles by 2016, in a move that cuts the manufacturer' dependence on fragile European markets.
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