Luis Rubalcava
Operations Manager
Tekfor Mexico

Localizing Forming Solutions for Premium Car Brands

Tue, 09/15/2015 - 16:34

Automotive demand for comfort, safety, and environmental protection are elevating the necessity for innovation, with the need to create near- perfect products growing exponentially. In response to this trend, automotive suppliers must develop proficiency in state-of-the- art manufacturing processes and project management, in order to establish themselves as competent partners. Part of The Neumayer Tekfor Group, Tekfor Mexico (Tekfor) specializes in forming, machining, heat and surface treatment, as well as the manufacture of individual, ready- to-install components for the construction of complete assemblies. The company manufactures weight-reduced, high-performance components in order to meet the needs of this demanding sector.

The Neumayer Tekfor Group has recently expanded its global business, opening new non-European market locations that focus primarily on Japan and Mexico. Refinancing carried out in 2009 generated new capital for the company and significantly increased its equity ratio, while the volume of orders at the beginning of the year was also considerably higher than forecasted. Tekfor Mexico was formed as a subsidiary in 2010, when Neumayer Tekfor began manufacturing components for a European rolling-element bearing manufacturer at its plant in Irapuato, Guanajuato. The plant initially started with prototype manufacturing and then commenced series production in the second half of 2010, helping to achieve its 2015 goal of employing 300 new people. Tekfor was acquired last year by Amtek Auto, creating the Amtek Tekfor Group, which describes itself as a market leader in the definition, development and production of pioneering solutions for transmissions, engines, drivelines, special applications and safety fasteners.

Luis Rubalcava, Operations Manager of Tekfor Mexico, explains that the takeover by Amtek Auto has strengthened the company’s financial situation, particularly as a result of a management style that is more focused on financial results. “The new management team reviews performance closely, regularly reporting on operations results in order to form a strategy for growth in Mexico,” he explains. “This helps the company to expand operations, offer added value, and diversify its product portfolio.” To maintain its promise to offer added value, Amtek holds several patents and shares global best practices between plants. Rubalcava is proud  that their forging process is globalized, and that many of theirproductsaremanufacturedonHateburmachineswith the advantage of producing millions of pieces per machine. Innovative processes, exemplified by the Hatebur machines, are crucial to the company, as well as a strong technical support network spread across facilities in India, Brazil, and Germany. This enables the company to send specialists in or out of Mexico when required.

The company is currently positioning itself in the market for new opportunities with premium companies, cultivating relationships both domestically and globally with luxury car brands. Rubalcava explains that the company has received many visits from potential customers who are now looking to do business in Mexico or in the US, and well-placed relationships will allow Tekfor Mexico to drive forging localization in Mexico. However, this will depend greatly on Mexico’s Energy Reform, and ultimately OEMs will require more local parts production. Even so, this will provide enough forging demand for Tekfor to supply, assuming the availability of special bar quality steel (SBQ) does not hamper production. This limitation is a result of the concentration of the steel mills that produce this quality of raw material in the US. Rubalcava’s concern arises from the threat of delays in the event of import complications, explaining that the projects to create these kinds of steel mills in Mexico will take five years or more to build and qualify. Presently, all of Tekfor’s products come from a forging plant in the US, but Tekfor Mexico is more than ready to expand. The Irapuato plant is producing at around 25% capacity, receiving approximately one million forgings from the US facility. The next step for the company would be to localize forging once a project is awarded in order to justify the expense.

Unsurprisingly, the level of competition in the industry is increasing. “We have seen many companies, both OEMs and suppliers, arriving to Aguascalientes, San Luis Potosi, Celaya, Irapuato, Silao, and Queretaro,” says Rubalcava. “Many suppliers are looking to the automotive industry, but they must be aware that crossing over from other industries is difficult, as the requirements are much more demanding.” Additionally, the government has already helped local suppliers by providing funds for training, advancing knowledge to the required level and boosting the overall industry specialists’ competence. Even so, our priority is to localize our diverse products in Mexico as soon as an opportunity to do so presents itself, as well as to continue building awareness of the company in the market, preparing Tekfor to pounce on new opportunities as soon as they are presented by premium car brands,” he concludes.