Imminent Loss Becomes Perfect OpportunityThu, 09/01/2016 - 14:30
Q: How did Vistamex evolve from the plant’s previous incarnation as Moulinex to develop as a supplier in the automotive market?
A: Moulinex decided to close its operations in Apaseo el Grande, Guanajuato in 2006. At the time, I was head of the human resources department and knew almost 250 people would lose their jobs. The plant had excellent plastics injection and white goods production capacity, so some of the employees and I decided to keep the plant and start our own operations. Eventually, the plant was sold to Arbomex but we kept all the equipment, allowing us to start Vistamex in late 2007.
Vistamex started manufacturing small domestic appliances and when the 2008 economic crisis hit, Arbomex decided to leave the plant to us. We approached new clients like Mabe and Automotive Lighting, which was when we entered the automotive sector as an aftermarket supplier. We saw an opportunity to participate more actively in this sector and Valeo was the next company to open its doors to us. We were not ISO/TS certified so Valeo audited our process directly and we have been its supplier ever since. Today we work with six companies within the Valeo Group, in Mexico and Europe, manufacturing plastic components and operating some subassemblies. This relationship helped us build a name for ourselves and to target other companies from the US, Germany and Japan. We moved from net sales of US$4.8 million to US$15.6 million in 2015 thanks to our diversification strategy after the economic crisis. Mabe still represents almost 30 percent of our total sales while our automotive division totals close to 42 percent of Vistamex’ production
Q: How did Vistamex begin its joint venture with Yamada?
A: We finalized our initial certification process in 2010 and before the year ended we received an offer from a Japanese company to buy our operations. We turned the offer down but three months later the company returned after realizing we were the most competitive player in the region. This company needed a closer production facility to reduce costs and a local partner to ensure the best operations. That is how Yamada- Vistamex was born in 2011 as a 75 percent Japanese and 25 percent Mexican joint venture. Our workforce in that plant is 100 percent Mexican and after five years we have already improved our production rates through lean processes. This has made us a reference for other Yamada plants around the world.
Q: What strategy have you implemented to consolidate your operations?
A: First, we identified the existing need in the market and then we integrated our operations offering competitive prices, the right quality and a timely service. We collaborated closely with the government of the state of Guanajuato as it monitored our development. The state even introduced us to several companies that wanted to form a joint venture with a Mexican company. Even though these negotiations fell through, we participated considerably with COFOCE to highlight our exporting operations. The organization helped us promote our activities and now we have more business outside Guanajuato than within.
When we started there was not the same demand for plastic parts in Guanajuato. GM’s supplier base was already established and neither Mazda nor Honda were an option to expand our reach. We are now ISO 9001 certified, which ensures quality management systems, and TS 16949 certified, which surveys the development of quality management systems. We have a Customs Trade Partnership against Terrorism (C-TPAT) certification and we are working on our NEC certification, which means we are fully prepared to be a supplier to the automotive sector. It has been a long and difficult process but we can proudly say that we now work with some of the leading suppliers in the industry like Hella, Valeo, Magna, Fujikiko and Sanko Gosei. We are building a plant in the Amistad industrial park and are expecting to move our operations to the new location by the end of 2016. Vistamex will be the first Mexican company in this park, which will offer us a better position to compete within the market. All companies can participate in any market, it is simply a matter of understanding the segment’s requirements.
Q: What added value can Vistamex offer its clients?
A: We moved from being just a plastic component manufacturer to a subassembly provider. Valeo was the first to present a specific problem with lighting harnesses and as we were already manufacturing the plastic covers for the headlights, the company asked us to assemble the whole body and test the electric wiring before sending the final component. Building a robust tooling workshop to support our operations is another objective for Vistamex. We want to be fully capable of maintaining and repairing all our clients’ tools and to make engineering changes to the dies. We are still working on implementing design and manufacturing for our own molds and tools. Finding people with the right expertise has been a challenge and we need to update our equipment for more complex operations.
Q: What are the chances of a joint venture with another automotive company?
A: Our joint venture with Yamada has been a great experiment to see how we work with a partner. We have two prospects for a new joint venture. The first is with an Eastern European company but we still need the right talent to make this relationship successful. Tooling experts are clearly lacking in Mexico as more than 80 percent of the components used in the industry are imported. The second prospect is with a Japanese company but the details are unclear. Vistamex is open to doing business with national and international players and as one of the biggest Mexican companies in the state, our next goal is to be recognized as a company where people feel happy at work. Our labor turnover is incredibly low, reaching only 1.4 percent annually in a region with rotation levels of 30 percent.