Thursday, 6 August 2015

Daimler-Nissan’s Mexico plant to roll in 2017

As BMW pushes ahead with its plans for its new plant in Mexico, the Daimler AG/Renault-Nissan Alliance launches a manufacturing joint venture in Aguascalientes in central Mexico to start in 2017.
Five years after their strategic cooperation was established, the new business entity COMPAS (Cooperation Manufacturing Plant Aguascalientes) that is 50:50 owned by Daimler and Nissan, the partners will invest US$1 billion in COMPAS to oversee construction and operation of a manufacturing plant that will make the next-generation premium compact vehicles for the brands Mercedes-Benz and Infiniti.

The state-of-the-art plant will be located near the Nissan Aguascalientes A2 plant. It will have an initial annual production capacity of more than 230,000 vehicles and will create about 3,600 direct jobs by 2020.  

Depending on market development and customer demand, there is potential to add additional capacity, possibly to make 500,000 a year.

Production of Infiniti vehicles begins first in 2017, while the first Mercedes-Benz vehicles will roll off the line in 2018.

Although COMPAS is deemed to be led by an international management team from Daimler and Nissan, Nissan has seen to it that its man is leading the company from the front. He knows, more than most, just how Nissan thinks and works. This is a big step up for him and a major assignment with total success as the only goal.

So Ryoji Kurosawa becomes chief executive officer supported by two Daimler men: Uwe Jarosch is chief financial officer and Glaucio Leite is chief quality officer. The last two appointments point to the core thrusts of the business: finance and quality.

The decision-making process of COMPAS is supported by a Board of Directors made up of three executives from each company. The board members from Daimler are: Michael Göbel, head of production compact cars, Mercedes-Benz Cars; Axel Harries, head of quality management, Mercedes-Benz Cars; and Christian Schulz, head of controlling, Mercedes-Benz Cars Operations.

The Nissan executives are: Armando Avila, manufacturing vice president, Nissan Mexico; Carlos Servin, finance vice president, Nissan North America; and Takehiro Terai, total customer satisfaction vice president, Nissan North America.

                                            Team building

The first item on their agenda has been one of team-building to establish the core of the new business to establish the ethos of the business.

Kurosawa of course sets the tone by claiming: “COMPAS is an outstanding example of the global reach of the Renault-Nissan Alliance and Daimler cooperation. Together we are combining the manufacturing expertise of Nissan and Daimler in one production plant in Mexico for the production of next-generation premium compact cars.”

“Aguascalientes was selected as the location for this new plant thanks to the state’s well-established supplier base and Nissan’s track record in highly efficient manufacturing in Mexico for more than three decades,” he adds.

Kurosawa has over 30 years’ manufacturing experience at both Nissan and Infiniti. In his last position as general manager of the Tochigi Plant in Japan, he was in charge of the production and quality of Infiniti, including the Infiniti Q50 flagship sedan.

“With COMPAS, Mercedes-Benz Cars will for the first time have a production location for compact cars in the NAFTA region and will thus be able to serve its customers close to the market in a flexible and efficient manner,” notes Jarosch.

Jarosch, as a time server, has put in over 40 years of his life at Daimler, so he too knows company thinking inside out. He has completed various and largely international assignments in finance and controlling. In his last position as CFO of the Mercedes-Benz passenger cars business in India, he had a responsible role in the significant expansion of the local production and the sales network in the country.

“By incorporating the best from both companies in terms of manufacturing and quality processes, we will produce top-quality products, maximize resources, and optimize costs at the same time. We are also making sure that both brands’ quality requirements and identities are safeguarded,” adds Leite.

With 24 years at Daimler, Leite knows commercial vehicles and passenger car production. He has occupied various functions in production and planning at Mercedes-Benz commercial vehicles as well as passenger cars in Brazil and Germany. In his last position, after several project assignments at the passenger car plants in the USA and China, he oversaw preparations for the final assembly of the next-generation E-Class at the Mercedes-Benz Sindelfingen plant in Germany.

As announced in June 2014, Daimler and Infiniti will also cooperate in the development of the next-generation premium compact vehicles for the brands Mercedes-Benz and Infiniti. The two partners obviously are closely collaborating at every stage of the product creation process.

They claim brand identity will be safeguarded as the Mercedes-Benz and Infiniti vehicles will differ from each other in terms of product design, driving characteristics, and specifications, but no doubt there will be opportunities for hidden parts sharing to benefit from economies of scale; the more so as Daimler and Nissan will also produce the next-generation premium compact cars at other production locations around the world, including Europe and China.

German and Japanese machinery vendors too will be looking for a slice of the action.

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