Piermatteo Barucco
General Manager
Materias Plasticas y Elastomeros de Mexico SA de CV (MPE Mexico)
View from the Top

New Japanese Entrants Offer Window of Opportunity

Thu, 09/01/2016 - 14:39

Q: As the new General Manager of MPE Mexico, what is your vision for the company?

A: We want to stabilize our 20 percent increase in sales to ensure this is sustainable growth. Secondly, we want to limit staff turnover as much as possible. Our benefits and salary plan will be updated to make staying with the company much more attractive. The majority of our team has five or six years’ seniority with MPE and the directors overseeing production and quality are critical to our success. Thirdly, we want to expand our plant to double the square footage we are currently managing. Therefore, in the next two to three years I will be fully dedicated to ensuring that we occupy this space effectively. Our interest in opening a new plant is dependent on finding an equally accessible location where our employees can continue walking or cycling to work, to maintain their quality of life and, consequently, their job satisfaction.

Our new plant investment is targeted at consolidating the business relationship with our established corporate customers and the Japanese companies entering the market. We hope to increase MPE Plastics visibility to Honda, Mazda and the full supply chain that these large brands have imported from Japan. As indirect suppliers we are tied to our most important clients. Guanajuato is a strategic location as we have an important client in Celaya, GKN, and work with ZF Sachs in Guadalajara, on top of other significant partnerships with companies in Queretaro, Toluca and San Luis Potosi. Once we consolidate our plant expansion, we could consider exploring other automotive clusters.

Q: How has MPE Plastics expanded its participation in the domestic automotive industry?

A: The year in which we entered the market, 2008, was a difficult year for the whole industry, but the owner of MPE Plastics maintained his vision. This put us ahead of the competition, as we had the time to consolidate partnerships with US and European companies over the years and to establish contact with Mexican clients, expanding our local customer base. MPE Mexico made a name for itself early on in the automotive boom. When we inaugurated our plant in 2008, we had two or three injection and blow molding machines. By the end of 2016 we will have grown to 11 machines. The 25 people we employ in Mexico are largely focused on production and maintenance but three are specifically dedicated to quality control, and we are pleased with our products’ standard. MPE Group also has a plant in North Carolina, which works with similar products to those machined in Mexico. Our design and project development operations take place in Italy, but our co- workers visit us periodically to relay information back to their technical teams at MPE Plastics’ headquarters. Our molds are produced in Europe with German or Italian companies, allowing us to guarantee the same level of product control around the world.

Q: How does MPE Plastics make contact with new companies that are installing facilities in Guanajuato?

A: We have recently been investigating an increasing number of Japanese contracts. In the first quarter of 2016, we signed a deal with a Japanese client, which we hope will be the first of many. The fact that MPE Mexico produces suspension arm dust covers and bellows for the majority of our local clients strengthened our reputation, allowing us to show our new Japanese client that our personnel and machines are highly competitive. We were also lucky enough to meet several companies at the most recent Automotive Forum in October 2015 in Leon, and spoke to the Japan External Trade Organization (JETRO). This increased our visibility and several Japanese companies requested facility visits to evaluate us as suppliers.

Q: There are a limited number of local raw material suppliers. How has that impacted MPE Plastics and what are you doing to overcome this hurdle?

A: Raw material suppliers, including those of plastic pellets, have opportunities to improve distribution in Mexico. The majority of large plastics producers have distributors based locally, but MPE Plastics requires tailor- made materials. We have to import 70 percent of the raw materials we need from two large providers in the US and from Europe. Thus, the presence of more local plastics suppliers would be hugely beneficial for our operations.