MEXICO - Energy & Mining
General Director, Válvulas Worcester de México
Héctor Cuellar Sosa is the General Director of Válvulas Worcester de México and has been working in the industrial sector since 1957.
TBY talks to Héctor Cuellar Sosa, General Director of Válvulas Worcester de México, on company growth and why its valves have become so successful.
Ours has been a family-owned business since 1963. My father established the company in Mexico City and, ever since, we have been established here in three manufacturing locations. Company growth has been in evidence on an annual basis. Our operations started out almost exclusively in Mexico, but over the years we looked to the export markets. Originally, it was Central and South America. Our operations in Central America are limited. One of the major players is Costa Rica, where there is a solid installed base for our products. Then, we have a presence with warehouses and inventory in Argentina and Brazil through sister companies. From those two countries, we supply the internal needs of these markets and export to Colombia, Peru, and somewhat to Bolivia, Uruguay, and Paraguay. The three manufacturing facilities in Mexico City produce diverse products for wide shipment. We have established our own foundries and forging plants, and while we import raw input, we employ local laborers and purchase all our equipment in Mexico. Válvulas Worcester de México has also been exporting to Asia for around a decade. We have representation in Thailand and have realized sales to the Chinese market for the past three years. My father is the president and founder of the Chinese-Mexican Chamber. We sell in Singapore, Malaysia, and Thailand, and the latest market we have been trying to crack is China. We target the specialty sector because China already has many bulk manufacturers. We do special applications, such as cryogenic values, which are very low temperatures, and also nuclear applications. In Europe business has been slow, and our sales offices in the Netherlands is currently in standby mode to see how conditions develop. We are seeing good signs from the Spanish economy, while the Italians are also doing well, and the Germans remain strong. Hopefully, over the coming years we can resume our European operations.
Only 25% of our established base here is geared at export markets. Fortunately, we retain a solid market share in Mexico of 60-65%.
There is increased potential for multinational companies to establish operations in Mexico. We are now in round zero of the energy reforms, and there are about 20 companies playing an important role. I hope that the government establishes a well-established base that renders the Mexican market attractive for companies looking to invest. Of course, the Secretary of the Economy has to play a key role with regards to the Mexican content. I was told that there would be a content requirement for international companies coming into Mexico of 25-30%. That Mexican content is divided into four sectors: manual labor, machinery, raw materials, and value-added products. Válvulas Worcester and other well-established Mexican companies stand to benefit the most. Of course, we also have to take into consideration the joint ventures that we will be able to realize with companies coming here.
First of all, we have been here for 51 years. Válvulas Worcester de México has an excellent network of 45 distributors throughout the Mexican Republic. Over 51 years millions of our valves have been installed. Companies coming to Mexico know that they can rely a local partner with extensive manufacturing facilities, and a good workforce with knowledge and experience. We have engaged in a wide range of industries ranging from oil and gas, to chemicals, petrochemicals, pulp and paper, and food and beverages, among others. Companies coming here can comfortably depend on our knowhow.
We are set for expansion, but mainly in terms of our product range, by adding automation, special valves, metal to metal, and products required by Mexico’s future oil and gas industry.
We expect to post YoY growth of between 12 and 15%. Experience leaves us confident that the third year of an administration sees investment. Moreover, this is an election year, and hence one of new budgets and financial allocations. We are therefore optimistic that 2015 will be dynamic. Of course, if everything goes through well and we see key players establishing themselves here, multinational companies will need to hire many people. Meanwhile, certain states such as Veracruz, Tamaulipas, and Nuevo León will see further grow than others.
© The Business Year – May 2015
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