A year after giving Mexico's auto parts sector a list of components for several small-car models, neither China's First Automobile Works Group Corp. nor its Mexican partner has placed a single order with a supplier in the country.
At a May 2008 news conference in Mexico City, Agustín Ríos, president of the national auto parts suppliers association, INA, told journalists that FAW of Changchun, China, and its partner, Salinas Group, planned to build the cars at a new assembly plant in western Mexico. Ríos said at the time that the firms required items and services from stamping and engine parts to plastic taillights.
“But I don't know of any companies [in Mexico] that are selling to them yet,” Ríos said April 15.
Asked whether he would have expected to hear if any deals had been done, Ríos, whose association's 235 members account for up to 70 percent of all component and parts production in the country, replied: “Yes.”
INA stands for Industria Nacional de Autopartes AC.
Another source close to the supply industry said FAW and Salinas Group, of Mexico City, had asked suppliers in Mexico not only to make, but to design, components for FAW. They had, however, received no firm orders, he said.
In November 2007, Salinas, a retailing and financial services conglomerate, announced it would import FAW cars from China in 2008 and start building them at a green-field site in the municipality of Zinapecuaro, Mexico, in 2010.
The Mexicans would own a majority stake in the plant, expected to cost about $150 million. The facility would take three years to build and have an initial production capacity of 100,000 vehicles annually, Salinas spokesman Daniel McCosh said at the time.
But Mexican Web site www.alvolante.info, citing a senior economy ministry source, reported last week that the federal government has granted the project leaders, who now use the name GS Motors (for Grupo Salinas Motors), another six months of import-tax waivers to give them time to start building the assembly plant.
Under Mexican law, would-be capital investors are permitted to import their products tax-free while they initiate construction of their manufacturing operations. GS Motors is believed to have imported several-thousand cars into Mexico. Ríos believes it has imported as many as 10,000.
A spokeswoman for Kathleen Ligocki, CEO of GS Motors, said Ligocki could not comment yet. GS Motors hired Ligocki, a former senior Ford Motor Co. executive, in August.
In a January interview with Automotive News, a sister publication of Plastics News, Ligocki said FAW-designed cars assembled in Mexico would be sold in the United States within five years — perhaps through big-box retailers such as Wal-Mart.
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