One-Stop Shop' Reducers Risk for OEMs

Q: Having operated in Spain, Brazil and the US, what attracted Aernnova to Mexico?

A: The industry boom began with Bombardier in 2006 but Aernnova followed closely in 2007. We built plants in Queretaro after a year-long analysis, carried out when Aernnova was barely beginning to establish operations internationally. Studies showed that out of 20 countries, Mexico and China were the best options for our envisioned process of globalization. Although China was the cheapest option at that time, economic analyses showed that Mexico’s growth was more stable. Additionally, the largest aerospace customers were in the NAFTA region and would remain so for the foreseeable future so Mexico was the ideal platform to target new commercial opportunities. We have seen stable costs and salaries first-hand, alongside a reasonable 3-4 percent rate of inflation.

The ability to offer our customers an integral solution to their needs at competitive costs is vital. This means integrally managing either industrial transition projects or new product developments while minimizing risks to customers. The operations available at our site in Mexico include assembly and manufacturing, more specifically machining, sheet metal, surface treatments, supply chain management and program management.

Q: To what extent have you collaborated with local educational institutions to develop aerospace specialists?

A: We help with training programs at UNAQ, which are jointly developed with our staff. Each class includes between 20 and 30 people and those who pass the course usually secure a job at Aernnova but continue with the training process during their first two months working at our plant. We also have collaborated with other universities, including ITESM.

In contrast with other areas and sectors, in which operators and engineers may be trained by one company and contracted by another, the Queretaro Aerocluster enjoys a cordial understanding between members not to take resources from another company. This is respected unless there is previous direct communication between the two companies’ human resources departments or if another company offers an employee a promotion. This maintains healthy competition within the cluster but we expect this will become more difficult to maintain as the sector inevitably grows in Queretaro. We protect our human capital from high turnover by offering competitive employee benefits and ensuring an enjoyable work environment.

Q: How would you evaluate the established supply chain in Queretaro?

A: When we first decided to move to Mexico, we only planned to build an assembly plant but our analysis in 2007 showed the supply chain was not sufficiently established to avoid importing the majority of components from Europe or the US. To be more competitive, we had to strategically adjust our internal capabilities to manufacture components. Our second plant was established to produce detail components based on machining, sheet metal and surface treatment technologies. Our cost-competitiveness has won the appreciation of Bell Helicopter, Textron Aviation, Bombardier and several other customers for simplifying their purchasing process. For example, the cabin and tail boom for Bell’s 505 Jet Ranger were constructed using approximately 90 percent Aernnova-produced materials. The high percentage of internally manufactured parts significantly reduced risks for Bell Helicopter.

Q: How have you contributed to the aero cluster’s growth in Queretaro?

A: Aernnova was an associate founder of the Queretaro Aerocluster and of FEMIA so one of our functions is to offer support to smaller companies by attracting important customers to Mexico. Securing aerostructure manufacturing contracts in Queretaro supports the growth of other companies that can provide peripheral technologies or products we do not manufacture. This includes pipes and tubing, harnesses and connectors. FEMIA and the numerous aero clusters in Mexico should promote suppliers of these goods to where companies such as Bombardier, ITP, Aernnova, Airbus and Safran need their services.