U.S. plastics auto parts manufacturer LDM Technologies Inc. is investing US$25 million to construct a plant in Mexico to serve multinational vehicle builders in Latin America. Over five years the Troy, Mich., company expects further investment in Mexico of up to $50 million at the site in San Luis Potos¡, Mexico, said William Kessler, LDM's business development and corporate resources vice president.
LDM is moving its headquarters from Troy to Auburn Hills, Mich., on Aug. 1.
LDM is due to start building its 160,000-square-foot unit, located on a 20-acre site on industrial land provided by the local Mexican state government, next month. Start-up of phase one of the scheme is set for January.
LDM Technologies de Mexico SA will injection mold a range of exterior parts including bumpers; under-hood parts, such as intake manifolds and reservoir bottles; and interior components, including consoles, cup holders and glove compartments.
The company has ordered 10 new injection presses for the new plant from the Japanese supplier Ube Industries Ltd. These will have clamping forces of 700-3,000 tons, Kessler said.
The Mexican plant will serve a number of multinational car builders in Mexico and other parts of Latin America, including Volkswagen AG, Ford Motor Co. and General Motors Corp.
Initially, it will employ 300, a figure expected to increase to up to 800 during the second and third phases, Kessler said in a telephone interview.
He said that the firm plans to produce interior components such as consoles, glove compartments and A, B and C pillars at the Mexican plant in the first year of operation.
``Then, during the second year we'll expand to exterior components, which would be front and rear fascias, and we'll be producing approximately 225,000 sets,'' he said.
LDM chose to build in Mexico because of the need to supply existing customers south of the border.
``Our customers are looking for suppliers that are geographically suited to their manufacturing facilities. San Luis Potos¡ is very central - to Ford, to GM and to Volkswagen,'' Kessler said.
He forecast that the Mexican location is reasonably placed to supply auto industries in South America. He added that it is ``very conceivable'' that LDM will establish another regional plant in Brazil longer term.
LDM already operates five manufacturing plants in the United States and one in Canada. Most are devoted to auto part production, but one plant in Indiana also makes consumer electronic goods components.