ThyssenKrupp opens plant in Mexico; targets EUR800 mn investment in US

Germany-headquartered automotive and machinery component maker ThyssenKrupp has opened a new steering components plant opened in Mexico.

Experts predict that car production in North America will rise by up to 12% by 2020. With 17 million vehicles produced in 2014, North America is already the world's second largest auto market. To participate in this growth the company plans to invest more than EUR500 million in its North American components business alone up to 2020. Altogether ThyssenKrupp will invest over EUR800 million in the growth region North America up to 2020.

With the plant opened, the Components Technology business area is strengthening its position as world market leader in automotive steering columns. ThyssenKrupp also sees significant market and growth opportunities for electromechanical steering systems, the latest development from the company's steering business. More and more auto manufacturers are turning to this steering technology, including in the high-volume midsize and compact segments. Electromechanical steering systems are more energy-efficient than conventional hydraulic steering systems, allowing fuel savings of up to 10% depending on vehicle. They are also a prerequisite for electronic driver assistance systems, such as park assist, lane assist and distance warning systems.

"North America is already ThyssenKrupp's most important sales market outside Germany, accounting for around 22 percent of our total sales," says Dr. Heinrich Hiesinger, Chief Executive Officer of ThyssenKrupp. "We are profiting from economic growth and the renaissance of manufacturing in the USA. That's particularly true of our components business, which is why we have started this investment drive. We are using the opportunity to continue to grow profitably here."

Altogether more than 20,000 employees generated around EUR9 billion sales in North America for ThyssenKrupp in the past fiscal year, a year-on-year increase of around 8%.

With the new steering systems plant ThyssenKrupp now produces components for the automotive industry at four sites in Mexico. The product portfolio ranges from engine and steering components to springs and stabilizers to the assembly of axle modules. Throughout the NAFTA region the components group has eleven sites and generated sales of around EUR1.6 billion in fiscal 2013/14.

"Our order books are full, so we are steadily expanding our production capacities in Mexico and the USA," says Dr. Karsten Kroos, CEO of the Components Technology business area at ThyssenKrupp. "And we have recently won a number of important new orders. To meet them we will be expanding and building new plants for chassis and engine components, above all in Mexico."

As recently as February 2015 ThyssenKrupp opened a new front axle assembly facility in Puebla. The company is building a further axle assembly plant 70 km away in San Jose Chiapa to supply Audi from 2016. In the coming year work is expected to start on the construction of a production line for cylinder head covers at a new engine components plant in the Bajio region.

To exploit further market opportunities the Components Technology and Steel Europe business areas have jointly launched a broad-based marketing campaign for components and new materials for the automotive industry in the USA. In the coming weeks the company will present its "InCar plus" R&D platform to customers in the US such as General Motors, Ford, Toyota, Nissan, Hyundai, Honda and Tesla. The platform focuses on eco-friendly solutions around energy efficiency, electromobility and lightweighting for the body, chassis and powertrain.

(IMA)

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