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Michelin planning to expand its production facility in Mexico

Mexico: The renowned tire brand, Michelin’s US based subsidiary, Michelin North America Inc. is planning to build a manufacturing facility in the Mexico. The investment in the construction of the plant is estimated to be worth USD510 million. The facility is likely to operate on a production capacity of nearly 5 million tires annually, however, the production at the plant would be hiked and expanded to double its manufacturing by the end of 2020. The facility is expected to be built in Central Mexico in the state of Guanajuato, wherein, the production is forecast to initiate by next year. The plant would excel in the production of passenger and light truck tires for the entire North American, European and Asian markets.

A Michelin spokesman also stated that the US based subsidiary of Michelin is planning to strengthen its operations in the North American market since a long time. As per the, International Organization of Motor Vehicle Manufacturers, Mexico was reportedly, the seventh largest vehicle manufacturer worldwide, due to the factors such as low labor cost in the country, free trade agreements and its close proximity to the United States. The company, Michelin already has its plant located in the state of Queretaro in Mexico.

According to a recent report published by TechSci Research, “Mexico Tyre Market Forecast and Opportunities, 2020”, with a motorization rate of more than 290 vehicles per 1,000 individuals in 2014, the Mexico automobile market offers a huge growth potential, thereby promising significant demand for tyres in the country in coming years. Owing to expanding automotive fleet size and increasing sales of vehicles, along with rise in the production of automobiles, the Mexico tire market is expected to hasten in coming years.

As per TechSci Research, Michelin is already a known brand for tires across the entire North America. However, by expanding its production facility in Guanajuato, Mexico, Michelin would further, able to enhance its share not only in the country but in the entire North American market. Moreover, the expansion would assist the company to tap its market potential, further in Mexico

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