SALTILLO, MEXICO — Metal-mechanics and ceramics company Grupo Industrial Saltillo SA de CV is going ahead with plans to invest $13.5 million to produce injection molds.
``As far as we know, no one in Mexico can offer high technology and complex molds for more-specialized uses, and almost all of the molds are imported, mainly from Canada, Europe and Asia,'' Alfredo Lopez Villareal, the project manager for plastic injection molds, said in an interview at the GIS offices in Saltillo.
The plastics molding plant will be operated by Ditemsa SA de CV, one of GIS' 10 companies, Lopez said. The 43,060-square-foot plant is being built adjacent to an identical Ditemsa plant that designs and builds complex tooling, mainly for the foundry industry. It will include facilities for computer-aided design and manufacturing.
The majority of GIS' plants are in Saltillo, in the northeastern state of Coahuila.
To fund its expansion plans, GIS successfully offered $85 million on the Mexican stock market, or Bolsa, Sept. 25-26. The corporation first went public in 1976. As part of this public issue, GIS made a series of presentations to the financial communities of Monterrey, Mexico, and Mexico City on Sept. 23.
Bond Snodgrass, an analyst for SBC Warburg in Mexico City, believes plastics is not a large investment for GIS, given the total size of the company's operations. GIS reported net 1996 sales of $3.84 billion and net profit of $521 million. As of June 30, the company netted $8.33 billion.
``It's too early to say. This investment will not [generate] significant income for the company for a while,'' Snodgrass said in a Sept. 24 telephone interview.
He added that it seems to be a logical move for the company, given its engineering experience, and that it may incorporate previous work in robotics technology from another of Ditemsa's pilot projects, Techmatec SA de CV.
Resin supplier GE Plastics de Mexico SA de CV helped initiate the idea for Ditemsa to enter the plastics industry. GE Plastics said high-quality mold production is need- ed within Mexico.
``They originally suggested the idea, as many of our clients are the same,'' Lopez said.
GE is not a financial partner and will recommend the new company's production only if the project turns out as planned, he said.
Ditemsa plans to produce the molds to customer specifications and requirements. Target markets are telecommunications equipment; automotive bumpers, instrument panels and dashboards; electronics; and appliances, Lopez said.
The company initially will build molds for presses with clamping forces of 50-1,000 tons, he said.
The entry into mold making for plastics is set up in three stages, with a total of $45 million assigned to the project. Construction of the first plant is under way, with trials scheduled for July 1998. Operations are to begin by January 1999. The first plant will start with 100 workers.
At the beginning of November, four Spanish technicians will arrive in Saltillo to assist in mold-production training, Lopez said. About 50 future employees have already begun training, the majority are graduates from the Colegio de Mexico and Conalep, the Coahuila technical institute.
Lopez emphasized that continued training and education is one of the key policies for all of the GIS companies.
``The Spanish molds are well-known worldwide, plus the learning is much easier since only one language is used,'' he said.
Plans for the second and third plants will be developed once the market's reaction to the domestically produced molds is seen, Lopez said. The other two plants will have a similar amount invested, but the locations in Mexico will depend on demand.
Lopez said locally produced molds will not be significantly cheaper, but there are other advantages to dealing nearby.
``Indirect costs can be reduced, like traveling to the mold production plant, or the long-distance calls to follow up on service,'' he said.
The main goal of the venture is not to export molds at first, but to substitute imported molds and gain share in the domestic market, Lopez said. He did not specify the company's targeted share of the Mexican market.
Data on the size of the Mexican mold market, including molders with in-house tool shops, are not available. An encyclopedia published by the Instituto Mexicano de Pl stico Industrial lists 61 companies in Mexico that provide molds, either as manufacturers or distributors and importers.