Volkswagen is building a $550 million facility in Mexico, the company announced today. The expansion is expected to create at least 700 jobs.

Mexican President Felipe Calderon said the facility will be located in Guanajuato and produce next-generation engines for Volkswagen vehicles. The company produced 325,000 cars in Mexico in 2009.

Volkswagen is working to triple its sales in the United States by 2018 to one million cars each year. It is also expanding an assembly plant in Puebla.