Monoflo International Inc. is expanding manufacturing into Mexico to better service the automotive industry there.
The transportation packaging firm has started production at an existing plastics facility in León as part of a joint venture with an undisclosed partner.
The joint venture, initially, will focus on injection molded production of bulk collapsible containers.
The new production adds to Monoflo facilities in Winchester, Va., and Ottawa, Kansas.
Starting manufacturing in Mexico will help reduce shipping and logistics costs for Monoflo and its customers in that region.
Automakers as well as their suppliers in the region are targets for the company that services a variety of markets.
"Really to help support our automotive business as that business builds out throughout North America," John Johnson, senior vice president at Monoflo, said. "It was important for us to have a North American footprint, not just a U.S. footprint."
"The reason for Mexico and what's going on in Mexico, there are an increasing number of OEMs [original equipment manufacturers] automotive plants have come into Mexico," Johnson said.
"Our play is to really get into that area," he said, and grab some market share while taking out transportation costs of serving the area from Monoflo's U.S. operations.
The company will initially focus on making bulk collapsible containers — measuring 48 by 44.5 inches to hold a wide variety of automotive parts — in Mexico.
"For us, it's Mexico for Mexico consumption. Pretty much anything we build in Mexico will be used by the automotive industry in Mexico," Johnson said.
"We built a number of new molds. They are really identical to the molds we have here in Virginia. They are getting the exact some product line whether they are buying it out of Virginia or they are buying it out of León," he said.
These high density polyethylene containers typically last several years and can be recycled when they reach the end of their useful life, he explained.
"I think many times you see a five- to seven-year life on these containers," Johnson said. "We tend to buy them back from our customers."
Other Monoflo products, including hand-held units, pallets and small bulk containers, will continue to be shipped to Mexico from the two U.S. sites.
Production in Mexico began in January at the business officially known as Monoflo Mexico, S de RL de CV.