Build-to-Suit Strategies for Automotive Clients

Q: How does USBA expect to bolster its participation in the market with the arrival of new automotive players?

A: Most of the company's revenue comes from the automotive and food industries. Our experience has made us key GM partners and we have worked with them mainly in Guanajuato, San Luis Potosi and recently, we performed an expansion project in Coahuila. We also participate with other industry leaders, such as Ford-Getrag in Irapuato, as well as with Plastic Omnium, Meiwa, Willi Elbe and Mazda.

UBSA has a list of prospective firms that may be interested in our design and construction services. In addition, we have a list of projects in the bidding phase, many of which are related to Tier 1 and Tier 2 suppliers. This year, we have noticed that new players arriving to the market share a trend for the build-to-suit under-lease scheme. Nevertheless, we have prepared strategic alliances in order to address recent market demands.

We have distinguished ourselves as a company that understands different business cultures of US, German, Japanese, Chinese and Swiss companies, among others. We know each customer has their way of working and our differentiator is that we have evolved to serve our customers in the best way. We have learned that some companies are committed to work with businesses of the same nationality, so, when main assemblers arrive, their design and construction suppliers also arrive with them. This has restricted possibilities, although we have managed to enter this segment.

Q: What are the main lessons UBSA has learned in providing services to the automotive industry?

A: We have always had the commitment to add value engineering to our projects, which allows our customers to save time and budget. For example, when GM arrived to Silao to install its production plant, it did so with an American engineering and design firm. However, most foreign engineering firms lacked the local know-how to implement and to improve the design and construction of the project. UBSA then proved to be a strategic ally for GM during the design and construction of the earthwork platform, the three stamping plants and the civil works that the project required. UBSA supported GM with value engineering-suggestions during key design and construction stages of the production plant. One of the most relevant results was the saving of 800 tons of steel structure for the stamping plants.

Q: What is UBSA doing to remain competitive in an increasingly complex environment?

A: We can provide significant added value to customers as we are local and have a clear understanding of local design and construction practices, laws, regulations and unions that govern Mexico. We also offer engineering and construction services within international construction standards since we are certified in OHSAS 18001, ISO 9001 and ISO 14001. UBSA´s infrastructure system is ready to meet any project type and size. Foreign companies, in contrast, do not have the same response capacity and have limited operations. UBSA commonly self-performs at over 67 percent for a turn-key project. The company has its own machinery to perform earthworks while civil works are also self-performed by UBSA, so we do not depend on third parties. We serve simultaneously between six to 10 projects in different locations, depending on our work cycle.

Q: What are the main challenges and opportunities for the automotive industry in the coming five years?

A: As long as our government has the commitment to keep a safe environment regarding security and infrastructure, many regions in Mexico will continue to have strong international appeal and investment for the automotive industry and for other sectors such as aerospace and energy.

As the automotive sector becomes increasingly attractive, competition will also increase. Businesses need to improve their differentiating factors and added value to remain competitive in the market. In the upcoming five years the industry will experience major changes related to the use of clean energy and environmental practices. Also, we have to be aware of the new arrival of automotive brands from emerging countries such as China and India as this could represent great opportunities for the construction industry.