New Artery for Global Automotive Industry
Latin American auto parts & materials suppliers growing under the support of trade with car manufacturers from Japan, Europe, and USA have begun to tap into Asia. For example, Mexico as the major export base to N. America, has more strong suppliers than ever. The Brazilian suppliers are also going to fast growing Asia. With utilization of the current cooperation, the new artery connecting Latin American and Asian automotive industries is going to be born. Nissan Motor COO Toshiyuki Shiga said in a Japan-Mexico business conference held in Mexico on July 24, “We have just announced to cooperate with German Daimler for co-production at the end of June. One month later we heard that German BMW planned to co-build a new factory with Korean KIA. We are all startled by the news.”
Mexico has been a major origin of car export with advantages brought by Free Trade Agreements with 45 countries. In 2013, its car production reached 2.93 million units (units sold domestically: 1.10 million). Its domestic market scale of new cars ranked 14th in the world and the car export was in the 4th place. Although Mexico continues to grow fast as a major car export country, it does not invest a lot in nurturing more local SMEs as its industry supporting base. But, more and more part suppliers benefited by the trade with automotive giants in Japan, Europe, and USA to upgrade the technology will continue to emerge.
The producer of core auto parts, Metalsa, set up its operation & technical support office in Yokohama, Japan in 2008. The most important point for this investment is focused on the trade with Toyota. Metalsa used to supply chassis from its Mexican factory to Toyota’s in N. America. However, Metalsa acquired the business of an U.S. company in 2010, broadening the trade with Toyota and helping it gain the order from Nissan. Metalsa’s strategy in Asia is not only limited to Japan. As Toyota continues to expand its global production, Metalsa also built its new factories in India and Thailand. In 2013, it acquired a German company and gained a production base in China. In China, Metalsa plans to increase the supply to Volkswagen which has the largest market share.
