KOITO MANUFACTURING CO., LTD. has announced its plans to increase its production capacity in Mexico and Brazil. Accordingly, this is part of the company’s medium- to long-term growth to meet the growing demands of the automotive industry.

Increased Capacities, Automating Plants

Recently, the automotive industry in Latin America has been growing continuously. Moreover, KOITO said this growth will continue in the medium to long term amid population growth and economic expansion.

Specifically, the company’s Americas business has established production and supply systems for automotive lighting equipment in the United States, Mexico, and Brazil. Due to proactive proposals of the company’s new technologies in the region, it is experiencing significant growth in orders from both Japanese and U.S. automobile manufacturers.

As a result, sales in Brazil are expected to double in fiscal 2026, while sales in Mexico are expected to double in fiscal 2028 compared to fiscal 2023. Therefore, leading to a projected shortage of production capacity in the Americas.
Against this backdrop, KOITO has decided to further enhance its production capacity by constructing a new plant in Mexico and expanding the plant in Brazil. In addition, the company also acknowledge the rising labor costs and labor shortages in the manufacturing industry in the United States and nearby regions. For that reason, part of the expansion plan is improving production efficiency. Specifically, by promoting automation of its plants and facilities in the region.

“We will strive to expand new orders through the enhancement of our global production system. In addition, we will also strengthen profitability through mutual support among our group companies,” said KOITO.

Details of Expansion

KOITO said the new plant in Mexico will rise at San Luis Potosi City. Specifically, the North American Lighting Mexico, S.A. de C.V., a subsidiary of the company, will run the plant. Mainly, its business is the manufacture and sale of automotive lighting equipment.

The current plant and the new plant will have a combined land area of 230,376sq.m and building area of 79,000sq.m. Meanwhile, the production capacity for headlamps of the two combined plants will reach 3 million units per year while rear combination lamps to 1.8 million units per year when the new plant starts its operations.

Investment amount for the Mexico plant is likely to reach 20 billion yen. Among its major customers are Toyota, Nissan, Honda, Mazda, Ford, and General Motors.

Meanwhile, the expansion of the Brazil plant will reach 209,700sq.m of land area when the new plant starts operations. The building area, on the other hand, will reach 33,400sq.m. On the other hand, production capacity for headlamps for the current and expansion plants will likely reach 850,000 units per year. Also, the rear combination lamps may reach also 850,000 units per year.

The investment amount for the Brazil expansion may reach 13 billion yen.

20 September 2024