En Englais: New Goodyear Mexico plant filling jobs

SAN LUIS POTOSÍ, Mexico — Goodyear is moving quickly to find the 1,000 technicians it will need for the plant it's building in San Luis Potosi, its first new tire factory in the Americas in a quarter of a century.

Over the next few months the company plans to hold a series of events for news media, suppliers, community leaders and universities aimed at attracting the most talented people available to work at the $500 million to $550 million facility, Eduardo Argüelles, Goodyear's head of public relations in Latin America, told journalists July 28.

At a formal ceremony on that same day, the Akron, Ohio-based tire maker broke ground in an industrial zone on the southern outskirts of San Luis Potosí in central Mexico, where the plant will be under construction over the next two years.

The 1 million-sq.-ft. facility will stand on a 94-acre plot of land. The cornerstone will be laid in November and the facility will be operational by July 2017, Martin Rosales, president and managing director of Goodyear Mexico, told dignitaries.

The new factory will produce 6 million passenger and light truck tires annually, predominantly “high value-added” models such as the Eagle F1 and Wrangler All-Terrain Adventure, according to Jean-Claude Kihn, a a 27-year Goodyear veteran who's been president of Goodyear Latin America since November 2014.

Goodyear has signed an agreement with the CTM — Confederación de Trabajadores de México — trade union, which will offer its representation to the plant's 1,000 blue-collar workers, most of whom will be local people, Mr. Rosales told Tire Business separately, noting that only 28 ex-patriots will be employed.

The CTM was founded in 1936 and was once notorious for its belligerence. However, CTM-led strikes are a rarity today.

Asked for details of any financial incentives that Goodyear may have received from Mexico's federal, state and/or municipal governments to re-invest in a production plant in Mexico, Mr. Rosales demurred before stating that infrastructure — including railroads, highways and inland customs services and the “seriousness” of Mexican authorities — was more important than financial incentives.

“These (financial incentives) are always short term,” he said. “Infrastructure is long term. This is much more important than a fiscal incentive.”

The San Luis Potosí plant is known within Goodyear as the “Americas Project.” Asked specifically whether Goodyear has plans to expand the facility over time, Darren Hayes-Powell, the project director, told Tire Business: “We have some capabilities to expand it, but it depends on the market.

“For us this is the first plant we (will) have built in the Americas for 25 years. It's something we are really very excited about.”

He said San Luis Potosí is “really a Mexican plant, but it can supply the rest of Latin America and North America.”

According to Goodyear, light vehicle production in Mexico increased to 3.6 million units in 2014 from 2.2 million in 2010 “and it's estimated it will grow to 5 million by 2020.”

The number of light vehicles on the road has risen to 17 million today from 15.5 million in 2010 and is likely to reach 19 million in 2020, the company added in a news release.

Goodyear has five other tire plants in Latin America — one each in Brazil, Chile, Colombia, Peru and Venezuela. It operated a plant in Mexico, in Tultitlán a dozen or so miles outside Mexico City, for 60 years before shutting it in 2001 “because its high costs are incompatible with current economic conditions,” the company said at the time.

Mr. Rosales said Goodyear decided to return to Mexico three years ago, and five states — including San Luis Potosí, which is 260 miles northwest of Mexico City — met all the requisites for a factory.

“Every one of them had what we had been looking for over a period of 10 months,” he told Tire Business.

Mexico has many elements that made it the ideal country for the new plant, he said in a speech at the ground-breaking ceremony. “It's prosperous and highly industrialized.

“Mexico,” he continued, “is the world's 14th largest economy and the second largest in Latin America (behind Brazil). It's a strong promoter of free trade.”

Goodyear, he added, operates through 150 tire dealers, who employ 900 full-time workers in Mexico.

“In the past two years Goodyear has increased sales in the country by more than 70 percent” and has added 12 product lines in that period of time, he said.

General Motors Co. has a car assembly plant in San Luis Potosí, which was Mexico's capital for a short time in 1863, while BMW A.G. plans to start assembling 150,000 vehicles a year at a $1 billion plant it is building in the city in 2019.

The Mexico City-Laredo railroad passes through San Luis Potosí, which also has a rail link to Aguascalientes to the west and Tampico on the Gulf of Mexico to the east.

According to Mr. Argüelles, among the reasons for Goodyear's selecting San Luis Potosí was the city's “specialized workforce.”

Beside the highway leading from downtown San Luis Potosí to the Goodyear site is a large sign reminding passersby that the state of the same name has Mexico's fifth lowest unemployment rate.

Stephen Downer is a Mexico-based freelance writer who covers that country and Latin America for Tire Business and its Latin America e-newsletter.

Editor's note: Eduardo Argüelles, Goodyear's manager of public relations for Latin America, notified freelance reporter Stephen Downer that he believes there was a “miscommunication” in Mr. Downer's story on Goodyear's new plant in San Luis Potosi, Mexico. He cited a quote in the piece from Martin Rosales, president and managing director of Goodyear Mexico, that the tire maker decided three years ago to build a plant in Mexico.

In his statement to Mr. Downer — and Tire Business — Mr. Argüelles said: “I think there is a confusion there. What he (Mr. Rosales) mentioned to you (Mr. Downer) during the conversation (sic). He mentioned to you that he decided to return to Mexico three years ago. He used to be in Mexico a few years before. The decision of, I think, making the plant in Mexico was not three years ago. Goodyear really made the decision to build a plant for the Americas in May of 2014, and during 10-11 months Goodyear reviewed many cities in the Americas, not just Mexico.”

Mr. Downer told Tire Business that his reporting on the time frame mentioned by Mr. Rosales was not in error and he stands by the original statement given to him by Mr. Rosales. Mr. Downer further corroborated his reporting with a statement given to him during a subsequent interview with Raúl Castillo, president of the Mexican tire dealers association Andellac, in which Mr. Castillo said that Mr Rosales told him three years ago that Goodyear would build the factory in Latin America.