Brazilian Bodybuilder Comes to Rely on Mexican EngineeringMon, 09/01/2014 - 11:38
Q: How has the role of Mexico in Marcopolo’s international portfolio evolved?
A: Mexico was our second largest operation outside of Brazil for some time but our work suffered after the crisis. We were affected by a lack of definition regarding our product mix, which kept us outside the coach market for two years. During that time, Colombia took over from Mexico as Marcopolo’s second market. But when Daimler Mexico lost ground in the coach segment, a lot of other competitors entered the market. We are now coming back and we aim to recover our strong position by next year. We used to import almost completed bodies to fit over the chassis, but we have now changed our business model and we are assembling 100% of the body in Mexico. This makes us more competitive and improves quality. The idea behind this move is to change from the importation of partially knocked down (PKD) units to completely knocked down (CKD) kits. We want to localize as much as possible and be highly independent from imported parts. There is a lot of opportunity in Mexico but due to the level of competitiveness seen here, we need to be able to react very quickly. Importing from Brazil takes time and causes delays that impact our ability to be fully competitive. Therefore, Marcopolo’s strategy going forward is to reinforce our production and engineering base in Mexico, connected with our engineering base in Brazil.
Q: How are you adjusting your product development strategy to pursue the goal of a more localized operational structure?
A: Our corporate engineering base in Brazil is responsible for product development, but developing a model does not only mean developing the base concept, it must then be adapted to each particular market and customer. The role of our Mexican engineering presence is to be close to the market, understand its needs, and adapt our products whilst being respectful to our core strategy and design concept. The Mexican market is the most demanding market in Latin America, regarding finishing, comfort, electronics, and even safety. For example, European buses do not have the level of comfort needed for Mexican passengers. Bus operators are incredibly professional and are pushing the market to provide an experience for customers rather than just a transportation service.
Q: How do you optimize the benefits of your partnership with Daimler?
A: Our partnership with Daimler is global and it is our largest chassis provider. This partnership is very natural to us and has proved its importance in Mexico and worldwide. We have common interests and identities, and neither a body nor a chassis can be complete without each other. As partners, we try to get us much advantage as possible from our proximity. We work together whenever either of us is developing a product while sharing the same plant. This means we share one facility, one cafeteria, and one security system as our aim is to maximize the benefits from the joint venture. As two separate corporate entities, we naturally have our own unique cultures, but we have been working together for 14 years. We have established an enduring joint culture of understanding and cooperation.
Q: Where are you focusing your R&D efforts?
A: There is a huge demand for more efficient buses, and costs are being pushed down at the same time. We are working together with Daimler to create safer and more efficient vehicles, and in our coaches we have a very good combination of both. Marcopolo developed its generation 7 model, with incorporated advanced aerodynamics that gives a big improvement in terms of fuel consumption. Daimler has developed Euro V engines that are much more environmentally friendly and efficient. This combination of two developments offers a very good solution to the market. Some customers have been testing our double decker against European models and the fuel consumption differences are huge. The Euro V engine is not obligatory in Mexico but a lot of customers are pushing for it nonetheless.
Q: What are your main objectives for 2014?
A: We plan to capture 25% of the coach market and 20- 25% of the city bus market, regarding complete buses. That will take us to a volume of around 1,800 vehicles. However, it is more important for us to be recognized as the best body provider in the market than to sell a certain volume. We left the market for a while, but 2014 is the first big year of our comeback.