Lego Systems Inc. has set up a Mexican subsidiary to sell plastic building block toys injection molded at its headquarters in Enfield, Conn. The company's parent, Lego Group, previously exported from Denmark and Switzerland to supply Mexico, said David Lafrennie, Lego Systems spokesman.
Lafrennie also said Lego's Enfield plant will resume full pro-duction this month after a slowdown that began March 3 in its packing operations there.
Corex SA de CV of Mexico City had been Lego Group's main distributor in the country and will continue to provide warehousing and distribution services for a year. Lego Mexico SA de CV will then lease warehouse space.
Lafrennie said Lego has no plan to manufacture in Mexico. However, he said the recent peso devaluation has not discouraged the firm's ambitions in Mexico, which it has supplied since 1989.
``We look at it as a long-term opportunity with very substantial returns,'' Lafrennie said.
``We may possibly also use it as a steppingstone to set up a similar operation in South America,'' he said.
Lego's slowdown in Enfield stemmed from retailers' excess inventory caused by a flood of competitive novelty construction products last year, said Peter Eio, Lego Systems's president. Lafrennie predicted some competitors will drop out of the construction toy market this year ``as happened in the mid-1980s.''
Lafrennie did not disclose how much Enfield throttled back its molding operation in March and April. About 300 of the plant's 1,300 employees were on a four-day workweek to avoid layoffs.
Lego also appointed Jaime Hernandez general manager of Lego Mexico. He was marketing director of Mattel de Mexico.