Volkswagen has confirmed what we suspected in October 2012: the next-generation Golf will be built in Puebla, Mexico, with production starting during the first quarter of 2014. The official announcement notes that Volkswagen Golfs intended for North and South American markets will be built at the plant, which will help the automaker reduce costs.

With the next Volkswagen Golf benefiting from lower production costs, we may just see a lower base price for the U.S. model. The Jetta currently carries an MSRP more than $1000 below the Golf, which starts at $18,890 for a manual-transmission, two-door hatchback. Add about $1000 for six-speed automatic transmission and $2000 for the four-door hatchback model.

"With its existing infrastructure, competitive cost structures and free trade agreements, Mexico is the ideal location to produce the Golf for the American market," said Hubert Waltl, Member of the Board of Management of the Volkswagen Passenger Cars Brand with responsibility for Production.

One look at the next-gen Volkswagen Golf's sheetmetal and you may not think much has changed, but the car has lost weight and has a more spacious interior. New cabin technology -- like the 5.0-, 5.8-, and 8.1-inch touch screens should help modernize the car, and there's plenty of new safety technologies, as well, including City Emergency Braking and Lane Assist.

Volkswagen Golf sales in 2012 numbered 40,885 units, a 17.8-percent improvement over 2011 but still far behind the Passat's 117,023 units and the Jetta's 170,424 units in 2012. With next-gen Golf production now officially confirmed to start in Mexico during the first quarter of 2014 and sales to start in the first half of 2014, the Golf might just see a bump in U.S.-market sales.

Source: Volkswagen