Eaton's Truck Components Operations has selected a site at the Tres Naciones Industrial Park in San Luis Potosi, Mexico, as the location for a new manufacturing plant to build transmissions for the North American market.
The new facility will have 350,000 square feet and will cost more than $100 million.
"Our forecasts continue to indicate strong demand for Class 8 trucks over the next several years, continuing at or near the production rates we've seen over the last two years," according to Jim Sweetnam, operations vice president for Eaton's Heavy Duty Transmission and Clutch divisions. "The new plant at San Luis Potosi will provide a vehicle to implement a world class level of manufacturing technology and a new approach to employee involvement unparalleled in the trucking industry today."
Eaton's long-term industry production outlook and plans are based on an expectation of North American truck manufacturers increasing their unit production out of their Mexican assembly plants. The new Eaton transmission plant will provide the increased capacity and production flexibility necessary to serve Eaton's OEM customers' demands throughout NAFTA for the foreseeable future.
Construction begins in the next 60 days, with initial production slated for the first quarter of 2001. The plant will be built in two phases - first with assembly capability, then with full manufacturing capabilities. Eaton Fuller 13- and 18-speed transmissions will be built at the new plant as demand continues to grow throughout the NAFTA market.
San Luis Potosi is located about midway between Mexico City and Monterrey, in the heart of the Mexican trucking industry. Other residents of San Luis Potosi include Cummins, Bosch, Valeo and Goodyear.
"As a good portion of NAFTA commercial truck manufacturing is becoming located in Mexico, it makes good geographic sense to manufacture our transmissions in Mexico," said Sweetnam, "but production from this plant will be routed throughout North America, to all our NAFTA OEM customers. Given the continuing strength in the North American heavy duty truck market, and Eaton's optimism about the market's prospects in the next decade, this plant's capacity will be needed to meet our customers' requirements, and should not affect plans for existing North American truck transmission facilities."