Monterrey (Mexico), Nov 9 (IANS/EFE): US heavy equipment maker Caterpillar Inc. began construction Thursday on a $500 million factory in the northern Mexican state of Nuevo Leon.

The investment will generate 1,000 direct jobs, Caterpillar Mexico chief Ron Riekena said during the ceremonial laying of the cornerstone for what will be the company's largest plant in Latin America.

Also present for the event was Nuevo Leon Gov. Rodrigo Medina.

The facility, located at an industrial park in Cienega de Flores, will produce components for Caterpillar's off-highway trucks, excavators and bulldozers, Riekena said.

Construction should be completed in late 2014, the executive said, attributing Caterpillar's choice of the Nuevo Leon site to the state's good infrastructure and transport links and its skilled workforce.

The firm had profits of $4.9 billion last year, up 82 percent over 2010, thanks to increased demand for its products.