Jatco, a subsidiary of Japanese automaker Nissan, is planning to invest $220m to build a new automotive parts manufacturing plant in Aguascalientes, Mexico.
Following the commencement of operations in summer 2014, the company's second facility in the region, is aimed at manufacturing 400,000 automatic transmissions per year.
Additionally, the new facility will manufacture automatic transmissions approved from Daimler, which will be used in some of Nissan and Infiniti models starting in 2016.
Established in 2003, Jatco Mexico is Nissan's first abroad manufacturing base and is involved in manufacturing continuously variable transmissions (CVTs) since 2005.
In 2012, Jatco's overall production reached 3.8 million units and the second facility will boost the overall Mexico-based production capacity to 1.7 million units of transmissions per year by 2016.
Jatco president and CEO Takashi Hata said since the start of production, Jatco Mexico has been steadily producing high quality products to meet the expanding demand for environmentally-friendly CVTs and that prompted making further expansion in this country.
"Another important reason is a strong support from the governments of Mexico and Aguascalientes," Hata said.
"With their continued cooperation, Jatco is determined to contribute to the economies of the region and the country."