By: Ivet Rodríguez
The installation of Audi, BMW and Mercedes Benz-Infinit plants in Mexico is an opportunity to raise the level of automotive production in the country. However, on the road to premium quality, there are several challenges to overcome, such as the consolidation of a competitive supplier base.
Armando Bravo, Director of the Center for the Development of the Automotive Industry in Mexico (Cediam), believes that in the start-up phase of their plants, these companies - with the exception of BMW, which already has a base of 64 suppliers in the country - will be supplied by imports. This while they consolidate a local base, made up of Tier 1 suppliers already installed in the country and newcomers.
Audi, for example, is building a plant in San José de Chiapa, Puebla, and is currently working on supplier development. Klaus Schie and Andreas May, the project's quality managers, will visit more than 100 candidates this year in order to advance the goal of 90% regional content by 2020.
"There is a good base of companies (many already working with Volkswagen), however, we see that some need to make investments to expand their plants or to improve some processes," said Bernd Martens, head of purchasing at Audi AG.
Daimler and Nissan will also make use of the suppliers they already have in the country to supply the plant they will build in Aguascalientes to assemble models of their Mercedes Benz and Infiniti brands, respectively.
BMW, on the other hand, will add some suppliers to the base it already has in Mexico. This year, the company will nominate 147 components -which it previously brought from Europe- such as headlights, skulls and windows, to supply the plant that will start up in Mexico in 2019.
Last year, BMW purchased more than 1.5 billion dollars from 106 plants in Mexico and with the search for new suppliers it could add nine factories -to reach 115- and reach a purchase volume of 2 billion dollars, explained Alfredo Monroy, logistics manager of Grupo BMW Mexico.
Among the requirements the company is looking for in its suppliers are quality, flexibility, competitive prices, technical offices in Germany (for innovation issues) and ISO/TS and VDA certifications (which originate from the Association of the German Automotive Industry).
They will train their suppliers
The companies' executives agree that training is key to achieving premium quality, so they will undertake various strategies to work with their suppliers.
"We want healthy suppliers," said Antonio González, director of the international purchasing office for the Americas. To achieve this, BMW trains companies and audits them constantly.
We evaluate them month by month, from their communication flows to their production processes. All this allows us to have a clear idea of their status, the executive explained. Currently, 80% of the companies that supply the company have a 'green light' and 20% are in the process of improvement.
Audi, for its part, will inaugurate a technical center in September where it will train suppliers and employees to achieve the quality required to offer the 'made by Audi' guarantee, that is, Premium quality regardless of where the components are manufactured, the country where the vehicle is assembled and the place where the model is purchased.
Having a local supplier base will allow German firms to comply with NAFTA requirements and obtain benefits such as tariff-free vehicle import quotas within the region.
Source: MANUFACTURA