MEXICO - Industry
Founder, Chairman, and CEO, SANLUIS Corporación
Antonio Madero is the Founder, Chairman, and CEO of SANLUIS Corporación. He has also served as a member of the International Advisory Board of JP Morgan Chase and on the Board of Directors of Goldcorp Inc. He graduated from the National University of Mexico and obtained his MBA from the Harvard Business School.
We are very proud to have been awarded the GM Supplier of the Year Award both in 2012 and 2013, as the only Mexican supplier to receive the award two years in a row. The award recognizes our innovative technology, superior quality, outstanding launch support, crisis management, and total enterprise cost solutions. We have been working with GM for the past several years, developing a new technology that helped us win the GM award. Rassini designed a new two-piece rotor for the Corvette that reduced its weight by 18% and offers better heat dissipation than previous designs, making it safer. We have continued to grow our relationship with GM and will soon be on approximately six of every 10 new GM vehicles with either brakes or suspension components. This recognition from GM not only resulted in more business from the automaker, but comes along with major orders from other carmakers. These new contracts have led to the expansion of our foundry in Puebla, as well as the new plant we are opening in the US. All of this is a reflection of a great team effort, reliability, and customer loyalty.
Rassini continues to drive top and bottom line growth and focus on leveraging opportunities in the US, Mexico, and Brazil. Our consistent focus on technology and engineering development has enabled us to secure new contracts; more than 40 new platforms since 2012. More specifically, North America represents 71% of our sales, so we are very optimistic about this market. The vehicle production projections for 2014 in the region are above 16.8 million units, which is an increase of 8% over 2013. Mexico is increasing its production in a very accelerated way, and we are poised to leverage this growth as our headquarters, production plants, and operations facilities are strategically located throughout Mexico. Research shows that Mexico, which produced 2.9 million vehicles in 2013, will soon be producing 4 million vehicles per year. Mexico is ranked above Canada, Spain, the US, and the UK in automotive exports, while one of every four imported units by the US is assembled in Mexico. The Mexican automotive industry is expanding not only with the American automakers, but also with Japanese and German automakers. For example, Audi is opening its first plant in Puebla in 2014. European trade is also open due to the Mexican Free Trade Agreement (FTA) with the EU, so we can export to the EU without paying duties. That is why Mexico has become a very important center for exports, since we can export to many markets at a lower cost than our competitors. I am very optimistic about what is going on based on realities on the ground, the investments already announced, and the activities that are currently happening. We have come a long way. It shows the competitiveness of Mexico because the Mexican labor force is excellent; the productivity of the labor force here is much more competitive than in China, and the logistics are also superior.
Rassini’s strategy focuses on leveraging opportunities for growth in our business. We are launching 40 new platforms in 2014, and in 2015 we should have another 20. During 2013 SANLUIS Rassini obtained new business, which will result in revenues of approximately $500 million over the next six years. The company is expanding strongly and we continue to diversify in terms of products and customers. In order to meet the demand of our clients’ new platforms, we are expanding our brake foundry and our machine center for rotors in Puebla. It is the largest brake rotor manufacturing facility with an integrated process in North America, and it will continue to expand as Rassini’s business grows.
In a word, excellent! We have increased the efficiency of the equipment over the past few years, especially since 2007. Now we have reached the point where we have to add physical capacity and additional machinery. Currently, 1,300 people are working in Puebla, and we continue to expand in the region. By 2016, we will be the number one supplier of brake rotors in North America. We are currently ranked within the top 100 North American suppliers and are one of the main suppliers to the “Detroit Three.” We have a very close relationship with our clients, so we are always looking ahead and being proactive in defining what’s coming next.
Rassini has an extremely loyal customer base, with 65% of sales amongst the Detroit Three. Some of these relationships span 30 years. Rassini also supplies major European and Japanese automakers with operations in the Americas and in Europe, such as Maserati in Italy. Volkswagen, Nissan, Toyota, Mercedes-Benz, MAN, Scania, Honda, and Volvo, among others, are also customers of ours, which reduces our exposure to competitive weaknesses or financial difficulties at individual OEMs. Our company is also looking to supply heavy-duty suspensions for large trucks and buses for Mercedes-Benz from four plants—two in Mexico and two in the US. This is an expansion of the business we have had with this customer for many years in the Brazilian market, and we pride ourselves on gaining the trust of this client and receiving the first orders for North America. Our goal is to meet evolving customer needs and cultivate strong and long-standing relationships that enable us to be considered an essential and preferred supplier to the automotive industry.
Rassini is experiencing impressive growth and expects continued strong financial results in 2014 and ahead, and the increase in sales and productivity will be impressive in the coming years. We are poised to leverage this growth as our production plants and operations facilities are strategically located throughout Mexico, and are expecting to exceed $1 billion in sales next year.
With a headquarters in Mexico City, four technological centers (located through North America and Brazil), and 13 manufacturing plants (two in the US, eight in Mexico, and three in Brazil), we are uniquely positioned to meet the growing automotive demand in Mexico and in the Americas. We are a technological leader in our markets, ranked within the top 100 North American suppliers by Automotive News. The automotive sector is huge in this country. Mexico employs roughly 1.7 million people a year in the sector, and it comprises 4% of Mexico’s total GDP. Rassini is a major supplier of suspension and brake units, and as a company we constantly strive to improve our services. We made a new suspension system that is 30% lighter than previous designs and began to develop our own technology from scratch. It used to be that our clients gave us the blueprints, but now it is our own technology that we use, and we continue to work with universities to develop more innovative technology. Rassini has a very close relationship with the University of Ontario, the University of Michigan, and the UNAM, among others, and we are continuously working with the academic centers in the US and Mexico, such as the Tecnológico de Monterrey, which produces excellent engineers. Mexico is producing better people with greater skills every year. We have a proud team, and we also support the families of the workers; we donate computers and train teachers how to use them. We strive to go above and beyond to serve the communities where we operate.
© The Business Year – March 2014
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