Truckmaker to build Freightliner, Sterling trucks in Mexico

PORTLAND, Ore. — Freightliner will open its second manufacturing plant in North America’s southernmost nation.

The continent’s biggest truckmaker says it plans to construct a new $300 million truck manufacturing plant in Saltillo, in northern Mexico dedicated to the production of Freightliner and Sterling trucks.

The new facility will provide additional capacity to accommodate Freightliner’s long-range product planning including an expected upturn in industry demand in 2009.

The company recently announced it would layoff hundreds of workers at its St. Thomas, Ont. Sterling plant as a result of an expected industry downturn in 2007.

Sterling, which currently builds trucks in Canada, will
shift some capacity south of the Rio Grande in early ’09

“This new facility underscores our confidence in the NAFTA truck market, and our bullish mid-term outlook for industry recovery post-2007,” said Freightliner LLC President and CEO Chris Patterson. “Frankly, we were not able to produce what we could have sold in 2006 due to capacity constraints. We expect another surge in customer demand in 2009 prior to the next round of EPA emissions regulations, and the construction of this new plant will ensure that we are fully prepared.”

The Saltillo plant joins the Santiago Tianguistenco plant which produces Freightliner-branded heavy- and medium-duty trucks for domestic Mexico sales as well as export to Latin America, the United States and Canada.

The new one million square foot facility in Saltillo is conveniently located near an existing Chrysler plant, which offers opportunities for synergy such as the extension of a supplier park and railroad terminal, the company says. DaimlerChrysler is Freightliner’s parent company.

The 740 acre site will also include a PDI/transporter center and test track, as well as room for future expansion. The plant could produce up to 30,000 trucks annually, and employ up to 1,600 production and management personnel. Groundbreaking is planned for the second quarter of 2007, with start of production planned for early 2009.

Five major U.S.-based OEMs now have Mexican manufacturing capability, where production and labor costs are significantly cheaper than in the U.S. and Canada.

“DaimlerChrysler has had excellent success in recent years with quality, cost and efficiency through our Mexican operations, and we fully expect the new plant in Saltillo to set benchmark standards for DaimlerChrysler Truck Group manufacturing facilities worldwide,” noted Roger Nielsen, Chief Operating Officer.


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