High-performance composite materials specialist HDC Hyundai EP (CEO Shin Woo-cheol) has begun operating production lines at its Mexican subsidiary, accelerating its full-scale drive into the North American market.

HDC Hyundai EP’s Mexican subsidiary announced that on the 6th (local time), it held a ceremony to launch operation of its production lines at its plant in Monterrey, Nuevo León, Mexico, and commenced full-scale mass production of its products.

Established in August last year, the Mexican subsidiary has completed eight months of equipment optimization and test runs, and, after going through technical approval procedures in line with North American market standards, is starting mass production this month. The plant, built on a 50,000㎡ site with an annual production capacity of 25,000 tons, has designed four of its six production lines as variable processes capable of cross-producing PP, PE, and engineering plastics, enabling flexible operation in response to demand fluctuations by material.

The plant is located in “Interpuerto Monterrey,” Mexico’s largest inland intermodal logistics complex, equipped with its own customs office and rail terminal. It is situated at the intersection of major rail networks (KCS, Ferromex) that connect across North America and highways leading to the U.S. border, and is also close to Monterrey International Airport. The Mexican subsidiary plans to leverage these geographical advantages to shorten product supply cycles and enhance logistics efficiency, thereby building a supply chain capable of responding swiftly to changes in local demand.

Mexico, as a strategic hub for the North American automotive industry, continues to post solid growth, setting new records in production. According to the Mexican Automotive Industry Association (AMIA), Mexico’s annual automobile production in 2025 reached approximately 4.23 million units, marking an all-time high for the second consecutive year following 3.99 million units in 2024. Domestic sales also exceeded 1.52 million units, achieving the highest level in nine years since 2016.

This growth is attributed to the full-scale restructuring of supply chains and the localization of parts triggered by the implementation of the United States–Mexico–Canada Agreement (USMCA) and the U.S. Inflation Reduction Act (IRA). In particular, under USMCA, the regional value content (RVC) requirement for major manufactured goods such as automobiles has been raised to as high as 75%, from 62.5% under NAFTA, thereby tightening the local production share requirement in North America to qualify for tariff-free benefits. In response, global automakers and parts suppliers have been building North American supply chains centered on Mexico, and this restructuring trend is expected to continue over the mid to long term.

In line with these environmental changes, the Mexican subsidiary plans to gradually increase its market share by expanding the supply of compound PP to major customers such as Kia (KMX), as well as to global automobile brands operating locally. As material localization and supply stability are key elements in securing tariff-free benefits, the competitiveness of locally produced products is expected to strengthen further.

HDC Hyundai EP CEO Shin Woo-cheol stated, “The full-scale mass production at our Mexican subsidiary is significant in that it expands our manufacturing base, previously focused on the Asian market, to North America and establishes a strategic bridgehead for our global supply chain,” adding, “Based on the local manufacturing infrastructure, we will expand our high-performance material solutions across the mobility industry as well as the electrical and electronics sectors, thereby solidifying our position in the global market.”

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