Victor Fuentes
Director General
Mitsubishi Electric Automation Mexico and Latin America
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Mitsuibishi Electric: Customized Solutions to Embrace Automation

By Alejandro Enríquez | Tue, 01/19/2021 - 18:11

Q: How has Mitsubishi Electric adapted to the digitalization of sales channels accelerated by the pandemic?

A: Five years ago, Mitsubishi Electric started providing digital content to its clients and abandoned paper until we realized that the Latin American market still used it. The pandemic allowed us to bring back our digitalization efforts and renew our bet on digital processes.

This extends to our distributors. Every year, they undergo a certification process that assures excellence in their operations and technical support in situ. This certification usually takes place physically but from mid-March 2020, we decided to implement home office schemes and conduct the certification process online. This process was quite successful. We are pleased with the results. In fact, by betting on digital channels we have expanded our market scope by incorporating people from Argentina, Colombia, Chile, and Ecuador.

Q: What has Mitsubishi Electric performed in Latin America during the pandemic?

A: We had positive results in 1Q20. Uncertainty emerged in 2Q20 in the face of an atypical market that, combined with the political and economic landscape, created adverse conditions for businesses in general. However, in 3Q20, the market started waking up. Naturally, demand has declined for some products, particularly in the automotive sector that suffered drops of around 40 percent as people were not that eager to buy a new vehicle.

We supply for manufacturing plants focused on ICE vehicles and their related components. As the industry transitions toward hybrid and EVs, we know that a plant reconfiguration is on the way. When it will happen remains uncertain but we see opportunities there.

Mitsubishi Electric has had offices in Mexico for 30 years but our products have been in the market for almost 50 years. 2020 made us recognize that we could not postpone our bet on direct solutions for our customers. We became a provider for plant renewals, startup projects, equipment reconfiguration, and more. We are certain Mitsubishi Electric will be a relevant player in this field.

Q: What opportunity do nearshoring practices represent for Mitsubishi Electric?

A: This will continue to strengthen Mexico’s role as an auto parts supplier. Given our location, we can also take advantage of the trade tensions between the US and China. Mexico’s manufacturing quality is world-class and this is in part thanks to access to state-of-the-art technology like Mitsubishi Electric.

Companies from Asia, Europe, and the US continue to invest in the country because they recognize the country’s added value. In addition to new investments, I also see opportunities to develop local talent. At Mitsubishi Electric, we have invested around US$400,000 per year in local universities so they can access the technology we provide. 

Q: How does Mitsubishi Electric help companies in Mexico to embrace automation? How do you add value to customers?

A: The quality of our products is essential. Our failure rate is 0.019 percent, which is minimal. This assures the high quality of the product and reassures our customers regarding the equipment they are acquiring. All of our equipment is tested for at least one year at our manufacturing plants.

We also support our customers through IoT solutions, mainly for machinery monitoring, at competitive prices. Our philosophy is “change for the better,” which means that any small suggestion that helps to improve the overall process is part of our added value. Industry 4.0, or E-F@ctory as we call it, means that a complete migration is not necessary because we can provide the specific elements that will help our customer to get the best of digitalization, from compressors or pump equipment to edge computing. Regarding the latter, we are performing AI tests for manufacturing operations.

Mitsubishi Electric supports the advancement of E-F@ctory in Mexico by bringing cost-competitive technology to the market. Our solutions do not require large investments. Moreover, we accompany our clients every step of the way. Our solutions are scalable and are set according to our clients’ priorities. Besides, our partnerships can provide support to ERP systems. Having the correct adviser in this process is key for mutual understanding. Again, our solutions allow clients to select what they need without necessarily migrating all their systems and equipment to smart manufacturing. We are the experts on automation technology. If we combine this with our customers’ expertise, it is a win-win scenario.

Q: What opportunities do companies at the lower level of the supply chain represent for Mitsubishi Electric?

A: There is a before and after of the pandemic. The industry saw the benefits of increased automation levels and two opportunities have appeared. One is to accelerate manufacturing plant automation for companies that are used to manual processes. For instance, one customer-focused on plastic injection had a turnover rate of between 25 to 30 people a week. This implies high costs when it comes to training. By automating part of the processes, savings in training can compensate for the initial investment while lowering the total ownership costs given that our products have some of the longest life cycles in the market. We are not laying valuable labor off. Rather, our focus is to professionalize the work as robots will not work alone.

The second opportunity is to integrate processes into IoT technologies. This means having real-time information about different plants, including material consumption, scrap, energy consumption, and other key variables. Our IoT solutions are to be launched by 2Q21. We are now focusing on modernization, migration, and system launches. 

Q: What other industries is Mitsubishi Electric focusing on?

A: We are interested in the mining industry, especially in material management. We offer solutions for regenerative systems, dynamic braking systems, safety equipment for cranes, and other related applications for the sector. We already have some customers in the Chihuahua region that are taking advantage of our solutions.

Q: What are Mitsubishi Electric’s expected results for 2020? What are your strategies to take on 2021?

A: Naturally, the pandemic had an impact on our sales. However, the impact was not as bad as we expected and we are now forecasting healthy results by the end of the year. We have enjoyed double-digit growth for five straight years and although for 2020 we had forecast a tough scenario, we will perform better than expected. We will keep our investments and teams in the country, with the safety of our staff our No. 1 priority.

Uncertainty will prevail in 2021 and we are yet to see the effects of the US election given our strong relationship with the country. Moreover, until the world sees an effective treatment against COVID-19, most operations will remain in controlled environments. Even though 2021 will bring different challenges to the sector, we are better prepared as we have adapted faster as a company. Opportunities will still be there and competition will increase, but our customers’ trust will prevail.

 

Mitsubishi Electric is a global company with over 50 years of presence in Mexico. It develops and manufactures electric products and systems, including industrial robots, motion control systems, operator interfaces, and computer numerical controls

Photo by:   Mitsubishi Electric
Alejandro Enríquez Alejandro Enríquez Journalist and Industry Analyst