Bridgestone unveils US$ 100 million investment plan in Mexico for the next two years
Faced with an expectation of growth in vehicle production in Mexico and despite the decrease in auto sales in the domestic market, Bridgestone plans to invest US$ 100 million between 2019 and 2020 in its Cuernavaca and Monterrey plants.
With these investments, the Japanese tire manufacturer will seek to develop new products and meet the specifications of the new trade agreement between the United States, Mexico and Canada (USMCA), recently announced in a conference before Mexican media Alfonso Zendejas, president of Bridgestone for Latin America.
Part of the investment will go towards the development of SUV and crossover tires, which currently represents 25% of the company’s total revenues in the country, “but it is a segment that is constantly growing,” said the official. Another important percentage, he added without giving a specific figure, will be destined to the development of products for the heavy truck industry.
Of course, an important incentive to invest will be export markets. According to the official, of the 29,000 tires that the Cuernavaca plant produces daily, 37% goes to the Mexican retail market, another 30% is delivered to the car manufacturers established in the country and the rest is exported. In the case of the Monterrey plant, the production is slightly lower, but 100% of it is destined for exports.
Zendejas explained that with the new USMCA rules, the tire companies will have to increase their regional content to support the automakers in order to comply with the new regulations, which will represent a challenge since currently there are not enough supplies, since much of the raw material is imported from other regions, mainly from Malaysia, Thailand and Indonesia.
“The rule of origin is something that we have to understand how it is going to apply at the level of vehicle manufacturer. As tire producers we are not obliged to reach that level of content, but we have to understand how it is going to be composed and the formulas and how the tire will formulate that support,” he said.
Zendejas added that he sees with optimism the agreement reached and trusts that it will work in the long term.