Pirelli, an Italian tyre manufacturing company, strengthens their position in Mexico by adding US$200 million in their investments with a new factory. The announcement was made while Italian Prime Minister Matteo Renzi was visiting the President of Mexico Enrique Pena Nieto, during celebrations at the Palacio Nacional, the presidential headquarters in Mexico City.
The new factory is in addition to the company’s existing car tyre plant in Silao, which was inaugurated four years ago within the Silao “Puerto Interior” industrial hub, in Guanajuato state. The new investment, which will begin in 2016, is in addition to the US$360 million invested to date and the US$50 million already earmarked for the 2016-2017. The company will be looking at a total investment of more than US$600 million in their two Silao plants at the end of 2018.
Production in the new plant will begin in 2017, and the company will employ the group’s most advanced technologies and processes. The Silao plant, built in 2012, has been focused from the start on the Premium segment, with production centered on High Performance and Ultra High Performance tyres for cars and SUVs, for the local and all Nafta area markets.
The annual output of Pirelli’s Silao production hub at the end of 2015 was around 3 million tyres. The factory, covering 140,000 square meters, will increase its annual production capacity to five million pieces at the conclusion of the initial phases of investment. The new US$200 million investment, which will permit the production of about 2.5 million tyres, Silao’s total production capacity will reach 7.5 million pieces by the end of 2018. Further, the new investment will bring in new jobs for the country. The workforce, which currently stands at 1,400 employees, is forecast to grow to over 1,800, beyond the already existing 400 ancillary workers.
The new investment confirms the importance of Mexico among Pirelli’s international operations, also thanks to its strategic position which has made it in recent years the ideal base to significantly develop Pirelli’s presence in the Nafta area, a market which has been confirmed as one of the most promising for the success of the Premium strategy. In 2015, Premium sales in the region grew by 24.3% and accounted for 90% of the total at the local level. Overall, last year the area registered sales of 861 million euro, an increase of 21.7% (+4.1% net of forex effects) and representing 13.7% of total group sales, up from 11.8% the prior year, levels above the forecasts contained in Pirelli 2013-2017 industrial plan.
In Nafta area the Mexican plant supports the production hub Pirelli has had since 2002 in the USA in Rome, Georgia. Pirelli aims to strengthen its collaboration with its main original equipment partners, to support the launch of new lines especially developed for clients in the area – like the Cinturato P7 All Season Plus, the Scorpion Verde All Season Plus and the Pzero All Season Plus – and to increase the weight of sales in the Replacement channel also thanks to the expansion of the FasTrack network, the growth of retail and geomarketing, capable of optimizing the management of customer inventories.
Source: Pirelli