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International News From the Field: Mexico, Brazil, and Latin America

Big investments in everything from paper pulp to electric vehicles to air conditioners and much more mean GDP expansion, job creation, and a strong path forward for resilient Brazil and Mexico. For more industry intel and other tidbits, read on.
Aug 09, 2023

Brazil

For more information, contact Achilles Arbex (aarbex@AMTonline.org).

  • Lang Technik announced its newest operation in Brazil. The German workholding and fixture manufacturer operated in Brazil for almost a year through MSB Technology and will do business directly moving forward. It plans to enjoy the next wave of Brazilian industrial growth as industries invest heavily in productivity and competitiveness.

  • Paper Excellence plans to invest $4 billion in a new pulp mill in Brazil. The company is conducting studies to determine the best region for the investment, which will generate more than 2,500 jobs and produce 2.5 million tons of pulp.

  • Eletra (Electric Traction Technology) officially inaugurated its electric bus factory in Sao Bernardo do Campo, Sao Paulo. The new facilities will produce 150 electric buses monthly, or up to 1,800 a year. The expansion is part of the company’s investment plan of $30 million, the objective of which is to position the company as a Latin American leader in the production of electric buses.

  • Bosch intends to invest $190 million in its operations in Latin America throughout 2023. The amount exceeds by more than 16% the contribution made by the company in the region last year, which totaled $160 million. The investment will mainly aim to improve production infrastructure, digitization, and research and development. It is also intended to improve production and research in other business units besides automotive, such as mining, agriculture, and power tools.

  • Volkswagen plans to grow by 40% in Brazil by 2027. The company recently announced 15 new models of electric and flex-fuel vehicles to be launched in 2025, including the automaker’s first two 100% electric models, the ID.4 and the ID.Buzz (the electric, reborn Volkswagen Kombi), which are expected to arrive in the second half of 2023. According to Volkswagen, it plans to invest $200 million through 2026. The investment will also go toward developing combustion engines based on ethanol and new business models.

  • T-Nax Smart Manufacturing, a machining service provider from Leme, Sao Paulo, has just received two M300X3 five-axis machining centers from Brother and is waiting for the delivery of a Mazak Integrex J-300 multitasking machine. The investment was made to address current needs to increase production capacity and growth expectations for the second half of 2023. In addition to increasing production capacity, the company has other objectives, such as replacing two- and three-axis machines with models with more embedded technology and optimizing its factory layout, which already has 18 machines.

  • WEG will invest $10 million in its plant in Manaus to meet the increasing levels of energy efficiency that have been established for the coming years in Brazil. The plant will be adapted to produce a new line of permanent magnet electric motors for split-type air conditioners. It currently has 5,250 square meters of built area and has a production capacity of approximately 3.5 million electric motors per year.

  • John Deere announced an investment of $7 million to expand the manufacturing structure of its facilities in Canoas, Brazil. The project will design, develop, and produce new sprayers locally, and they will be marketed toward small and medium producer segments.

  • Brazil's lower house of Congress approved the main text of a tax reform that will restructure the country's complex consumption taxes. Over eight years, beginning in 2026, the reform plans to merge five levies currently in place into a value-added tax with separate federal and regional rates, which will be defined later by a complementary law. Markets reacted positively to the lower house approval; Brazil's real strengthened against the dollar, and benchmark stock index Bovespa (.BVSP) jumped.

Mexico

For more information, contact Carlos Mortera (cmortera@AMTonline.org).

  • Mata Automotive announced plans to produce decorative carbon fiber components in its Aguascalientes site. The company estimates a total output of 1.5 million pieces per year, specifically for its clients in Mexico. The company expects to initially provide these parts to Tesla, as well as other brands of electric vehicles, such as Aston Martin, Bentley, Jaguar, Range Rover, RAM, Jeep, and Corvette.

  • Mitsui High Tech announced the installation of a plant in Apaseo el Grande. The company is considered the leading provider of frames for integrated circuits, precision tools, motor cores, and surface grinders. The company will invest an estimated $7 million and generate 180 new direct jobs for the people of Guanajuato.

  • Chinese company Top Band inaugurated a manufacturing plant in Cienega de Flores as part of a $35 million investment. With this operation, the company will employ 300 people to produce electronic controllers. Top Band provides smart control technology for home applications and industrial tools.

  • Bendix, a commercial vehicle systems developer, began construction of a new production plant in Ciudad Acuna, Coahuila, which will feature the latest technology and produce global scalable brake control and global scalable air treatment technologies, which are new global modular braking control and air treatment systems.

  • BorgWarner held a groundbreaking ceremony for the construction of its new production facility focused on power electronics and electric motors in San Luis Potosi. The company, which is dedicated to creating innovative and sustainable mobility solutions for the vehicle market, chose this state for its strategic location to support the industrial supply chain in Mexico and the world.

  • With an investment of $46 million, CFMOTO inaugurated its first plant in Mexico in Apodaca, Nuevo Leon, where 27% of the city’s 148 investment projects correspond to the automotive sector. CFMOTO manufactures ATVs, motorcycles, engines, and accessories. Globally, it has a presence in Asia, Europe, and North America and has more than 5,000 global employees.

  • The relocation of supply chains could trigger investments of around $80 billion in Mexico in the next two or three years if certain conditions are met, including adequate infrastructure, said Guillermo Vilchis, a senior director at Fitch Ratings. Until now, the country has registered investments of $40 billion due to nearshoring, but this amount can be doubled, he stated during a panel organized by the rating agency.

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Author
Carlos Mortera
Senior Director - Latin America
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