Honda ‘s New Transmission Plant in Celaya Shows Faith in Mexican Skilled Labor

Commentary by John Paul McDaris

Honda recently began construction of a $470 million transmission plant in Celaya. The facility will be located next to Honda’s new $800 million production facility that will start mass-producing the Honda Fit early in 2014.

The Celaya transmission plant will begin producing continuously variable transmissions (CVTs) in Q2 2015 with an initial production capacity of 350,000 units per year. Basing the CVT manufacturing in the same location as the auto plant will give Honda de Mexico a highly efficient production structure that maximizes local content in Mexico, the rest of North America and globally, according to Automotive World.

Honda’s choice to base their CVT manufacturing in central Mexico speaks to the confidence the Japanese OEM has in the level of talent available in the area. With ample skilled labor and engineering training centers in the Bajio region, it’s easy to see why the OEMs and suppliers – both large and small – are clustering here.

The Honda investment – as well as those in the area by Mazda, Nissan, Audi and a host of tier 1-3 suppliers – is also further evidence of a combined local/global strategy. Production in Asia is for the Asian market. Production happening in Europe is for that market. And, these days, companies looking to expand auto industry production for the North and South American markets (especially the emerging markets) are largely looking to Mexico.

Source: Automotive World

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