Local Know-How Key for Foreign Customers

For technology integrators, local know-how is a major asset when approaching potential foreign partners. “Some companies prefer to have local technology integrators when installing a new assembly line because it makes maintenance services more accessible. Local know-how is our main advantage,” says Hugo Martínez, Administrative and Commercial Manager of Aquantium Technologies.

The Mexican company is based in Guanajuato and develops automation solutions for the automotive and pharmaceutical sectors. It has taken advantage of its presence in the Bajio to participate in the automotive supply chain, which accounts for more than 80 percent of its client portfolio. “The automotive sector is looking to develop local suppliers to avoid downtime in production processes. Unlike a foreign integrator, response times are shorter for local companies,” Martínez says.

Being in the Bajio region is a major advantage for local technology integrators given the large presence of automotive companies in the area, Martínez says. “This makes it easier for us to provide technical support. In addition, local research centers like CIMAT Guanajuato are really supportive of SMEs, helping them to improve their processes.”

Working for Tier 1 or Tier 2 companies requires a certain level of sophistication and technical capacity. Martínez says the most difficult part is earning the customer’s trust. “Aquantium has worked with Continental, Valeo and Volkswagen. This demonstrates that our company has the capacity both technically and operationally to comply with their expectations,” he says, adding that customer experience is a major area in which Mexican companies need to improve. “To improve after-sales service, proper follow-up is essential.”

Martínez points out that it can be difficult to penetrate certain companies in the automotive industry, but if local businesses focus on both procedures and quality, they can succeed. He gives the example of Mexican companies participating in the supply chain of Korean or Japanese companies. “Japanese companies feel really strong about their rules and they are more likely to trust a company that follows the procedures they are familiar with. If you show Japanese companies that you can take care of the processes, they are more willing to work with you,” he says. Moreover, Martínez emphasizes that even though collaboration with OEMs and their suppliers can be complicated, it is worth the effort. “It is not impossible to work with them. We have learned that once you earn their trust, it becomes a long-standing relationship,” he says.

To foster the participation of local suppliers into the automotive supply chain, business platforms can be a vital strategic tool. “We are working with an online platform that lists companies with specific qualifications and certifications for the automotive sector. Potential customers can search for and verify companies. These platforms are an opportunity for the local industry,” Martínez says.

Local companies should also focus on implementing technology solutions to boost their production processes to be more competitive. Martinez explains that technology goes hand in hand with continuous improvement. “A Mexican company wanting to compete against a foreign player needs to invest a lot on technology. Some local production systems still rely on manual labor, while our competitors have already fully automated production lines,” he says.

Even though technology is a must, when talking about Industry 4.0 some distinctions need to be made, Martínez says. “The industry is aware of the changes Industry 4.0 will introduce, but the concept itself has a wide variety of implications. It depends on your plant, your processes and how far you want to take a fully supervised system. It is necessary to understand the concept and then adapt it to company’s needs,” he adds.