MEXICO CITY Japans Maruichi Steel Tube Ltd. has started operations at its new steel tube mill in central Mexicos Aguascalientes state.
The mill, which will supply steel products to the countrys auto industry, will have the capacity to produce 12,000 tonnes per year of steel tubes, the company said.
The new $10-million manufacturing center covers 322,917 square feet.
"We plan to locally manufacture the high-quality automotive steel tubes and meet users local procurement needs for raw materials," Maruichi said.
The company plans to supply Japanese automakers Nissan Motor Co. Ltd., Honda Motor Co. Ltd. and Mazda Motor Corp., as well as General Motors Co. and Chrysler Group LLC plants in the United States, the government said Feb. 25.
The construction of the steel tube facility will be managed by a joint venture between Maruichis U.S. subsidiaries Maruichi American Corp. (60 percent), MKK USA Inc. (20 percent), and trading companies Marubeni-Itochu Steel Inc. (10 percent) and Toyota Tsusho Corp. (10 percent).
Aguascalientes state has attracted considerable attention as an automotive manufacturing base in North and South America. Nissan announced plans last year to invest up to $2 billion in a new manufacturing complex in Aguascalientes to support the companys Americas growth strategy.
Mexicos automotive industry expects annual production to reach 4 million vehicles within the next five years, according to Mexican automotive association Amia.
In 2013, the auto industry expects to see more than 3 million cars produced in Mexico.
Vehicle output reached roughly 2.88 million units in 2012, up 12.8 percent from about 2.5 million units in 2011, Amia said.
A version of this article was first published by AMM sister publication Steel First.