Sponsored By
Clare Goldsberry

October 5, 2016

3 Min Read
Automotive sector continues to drive Mexico’s manufacturing boom

According to an editorial in the Oct. 3, 2016, issue of IHS Automotive SupplierInsight, Audi became the latest automaker to open a production base in Mexico. “The premium car unit of the Volkswagen Group inaugurated the facility in San Jose Chiapa in Puebla, the company’s first manufacturing plant in North America,” said SupplierInsight. “The company invested over $1.1 billion in the new plant, which has an annual production capacity of 150,000 units. [The plant] will become a global production source for the next-generation of the Audi Q5 sport-utility vehicle, which the automaker is showcasing at the Paris Motor Show.”

Audi's new facility in San Jose Chiapa, Mexico.

SupplierInsight’s editorial notes what PlasticsToday has written about a number of times over the past few years, namely that “automakers are scrambling to set up a production base in Mexico to serve key automotive markets . . . attracted by Mexico’s 12 free-trade agreements covering more than 50 countries.”

BMW and Mercedes-Benz are also establishing facilities in Mexico. BMW began construction on a $1 billion plant in San Luis Potosi this past June “with a production capacity of 150,000 units,” said SupplierInsight. Mercedes-Benz will set-up shop in Aguascalientes with a $1.4 billion investment.

The recent issue of MexicoNOW noted that Ford Motor Co. is planning to make hybrid vehicles in San Luis Potosi with an investment of $1.6 billion; construction began this past summer. That facility will create 2,800 direct jobs in 2020. “Ford also plans to expand the Cuautitlan plant, adding 500,000 vehicles to its annual production in Mexico,” said MexicoNOW.

While Ford announced that it will stop its small-car production in the United States, citing higher costs, the company also unveiled a major investment ($1.6 billion) in its U.S. facilities.

Guanajuato was chosen for Volkswagen’s latest investment, reported MexicoNOW. “Due to the growing demand for engines originated by the three new production lines of Volkswagen in North America and the fact that the Silao factory in Guanajuato is considered in the expansion plans of the company for future investment, the Governor of Guanajuato, Miguel Marquez Marquez, visited the VW production plant in Wolfsburg, Germany.  

IHS SupplierInsight projected that “vehicle production is set to see rapid growth in coming years” and “forecasts light vehicle production will grow from 3.39 million units in 2015 to 4.9 million units by 2020. The strong growth in investment by automakers is driving automotive suppliers to invest in Mexico,” notes the article, adding that “hardly a week goes by when there is no announcement of an investment by suppliers.”

One of those suppliers, Vermont-based GW Plastics, which has a plant in the manufacturing hub of Queretaro, is celebrating 10 years in Mexico. Focused on manufacturing high-precision, safety-critical automotive and medical device components, GW Plastics Queretaro is proud of its success and growth in supporting market-leading OEMs with operations in Latin America, said the company’s release.

The GW Plastics facility in Queretaro was founded in 2006 to support the rapidly growing automotive market. The company subsequently expanded into supporting the medical device market in the region. GW Plastics Queretaro currently houses 25 injection molding machines ranging from 50 to 660 tons. In addition to precision injection molding, the state-of-the-art facility offers customers in-house tooling and assembly of finished products. GW Queretaro has invested heavily in scientific injection molding capabilities and advanced automation to deliver Six Sigma quality performance, achieving defect levels below 3.4 parts per million.

GW Plastics is looking toward the future of its Queretaro plant with optimism, having recently completed a major upgrade of its facility.

Brenan Riehl, GW Plastics’ President and CEO, attributed GW Queretaro’s success to the professionalism and stability of its Mexico-based leadership, highly trained workforce and commitment to long-term customer relationships. “We are proud of our growth during times of economic uncertainty throughout the past decade,” said Riehl. “Our success in Mexico has solidified us as a global plastics contract manufacturing partner of choice, and we are delighted to celebrate this anniversary with our employees and customers. We would like to extend our gratitude to all of our hardworking team members and loyal customers for helping us achieve this important milestone.”

About the Author(s)

Clare Goldsberry

Until she retired in September 2021, Clare Goldsberry reported on the plastics industry for more than 30 years. In addition to the 10,000+ articles she has written, by her own estimation, she is the author of several books, including The Business of Injection Molding: How to succeed as a custom molder and Purchasing Injection Molds: A buyers guide. Goldsberry is a member of the Plastics Pioneers Association. She reflected on her long career in "Time to Say Good-Bye."

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