Among the dry, scrub-covered hills outside the Mexican town of San Jose Chiapa, a plot of land the size of 45 football fields will soon give Volkswagen Group a boost in its effort to become the world’s biggest automaker.

There, executives from VW’s Audi luxury unit on Saturday broke ground on a $1.3 billion factory with a capacity of some 150,000 cars a year. The plant will be instrumental in Audi’s push to topple BMW Group as the world’s No. 1-selling premium automaker.