Nissan Celebrates Phase One of 2 Billion Growth in Mexico

Nissan Celebrates Phase One of $2 Billion Growth in Mexico

Nov. 14, 2013
The company's third plant in Mexico will allow for a 25% production increase, to 850,000.

In a bid to consolidate Nissan’s “leadership in the domestic market” in Mexico, Carlos Ghosn, CEO of Renault-Nissan Alliance (IW 1000/31), on Tuesday celebrated the opening of the first phase of a manufacturing complex in Aguascalientes, Mexico.

Currently, Nissan produces approximately 1 out of every 4 cars made in Mexico.

With this new plant producation capability in the country will increase 25% to 850,000 annually.

Located four miles away from Nissan Aguascalientes 1, the facility will ramp-up to full capacity running 23 hours a day, six days a week, for 284 days a year. The company notes that this plant achieved an all-time industry record by start operations just shy of 19 months after land leveling.

"Cuernavaca was our first vehicle plant outside Japan; thirty years later we extended our manufacturing footprint to Aguascalientes," said Armando Ávila, manufacturing vice president of Nissan Mexicana. " As we open a second vehicle plant in this state and welcome 3,000 new employees who already work at the new plant. Through months of training, they have become a part of our family and now share our culture and passion for quality."

Environmentally minded design influenced the development of the Aguascalientes 2 plant as a whole, the company expalined. Seven percent of ceiling parts are translucent, allowing for natural light to flood operations throughout most of the day. A zero-discharge, water treatment recycles water used for internal and landscaping services. Moreover, a portion of the land was prepared as an environmental reserve, including fertile soil moved during the development process and native plant species. The reserve is being designed for the leisure use of employees and the community.

With this investment, Nissan generates more than 3,000 new jobs in Aguascalientes and over 9,000 indirect jobs.

One of the main features of Aguascalientes 2 is the flexibility to build vehicles from different platforms, in order to adapt to the changing customer demands. The first vehicle to be produced in Aguascalientes 2 will be the 2014 Nissan Sentra, exported to more than 20 markets.

"What we see today is only the first phase of the Aguascalientes 2 complex," said José Luis Valls, president and managing director of Nissan Mexicana. "Our goal is to reach the 1-million cars milestone in the midterm.

Adjacent to Aguascalientes 2, Nissan and Vesta are developing "Douki Seisan Park (DSP)" an integrated supplier park within Aguascalientes 2's footprint. The DSP's close proximity allows an intrinsic link between automotive suppliers and the production processes. During its initial stage, and with an investment of $57 million, the DSP will host on 140 acres (57 hectares) suppliers within five buildings of 1.6 million square feet of construction, with the potential of expanding further in the future. Already in positions are: POSCO, Tachi-S and Sanoh. Also nearby is Nissan's transmission supplier company, JATCO, with a second plant in Aguascalientes developed at an investment of USD$220 million in 2013.

The plant, which is the company’s third in the country,”is part of a $2 billion investment which falls under the company's "Power 88" growth strategy. The goal is to achieve 8% market share and 8% operating profit by 2016, in part, through strategic investments such as Aguascalientes 2, a new plant in Resende, Brazil scheduled for opening in 2014 and the recent integration of Nissan LEAF and Nissan Rogue to the Smyrna, Tenn.  manufacturing plant.

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