DETROIT — German powertrain provider Vitesco Technologies stated it plans to open a brand new plant within the U.S. to assist it meet surging demand for its electrification merchandise.
Vitesco is within the technique of evaluating potential areas for a brand new U.S. manufacturing facility, together with greenfield and brownfield websites, Sandy Stojkovski, the provider’s North American CEO, stated on Thursday. The firm expects to make a last resolution on the plant’s location within the subsequent few months, with plans to open it by roughly 2026.
Stojkovski stated Vitesco goals to open a plant comparable in measurement to its manufacturing facility in Seguin, Texas, which has about 1,700 workers and is liable for about $1 billion in annual gross sales. The plant would assist Vitesco to maintain up with surging demand within the area for electrification-related merchandise, she stated. In 2022, the corporate generated €1.1 billion ($1.17 billion) from international electrification gross sales, and expects that determine to succeed in €5 billion by 2026.
“Because of all the new business we’ve been awarded, as we look at the outlook for the North American region, it implies that we would be doubling our sales in the region,” Stojkovski stated at a media roundtable on the Detroit auto present. “That creates a bit of a problem for us, which is that we don’t have enough production capacity in the region to handle this new business.”
Stojkovski didn’t say what number of areas the corporate is taking a look at, although she stated metro Detroit and Michigan extra broadly have been in consideration.
“It’s a complex decision process,” she stated. “We’re talking to the various states about what the most compelling options available to us are.”
Key elements in selecting a location embody state and native incentives made obtainable to the corporate, along with federal incentives that Stojkovski stated Vitesco expects to be eligible for underneath the Inflation Reduction Act. Others embody entry to wind and solar energy, and to expert labor.
“Labor availability is a big one, and not just all kinds of labor, but the right kinds of labor,” Stojkovski stated. “We still are in a war for talent.”
The funding plans come as vital uncertainty stays in regards to the tempo of electrification and the expansion of electrical automobile gross sales within the coming years, notably in North America. As a outcome, Vitesco CEO Andreas Wolf stated the corporate will take a “very flexible approach” to scaling up manufacturing on the new plant.
“Since we have a modular approach with our products, we are extremely flexible,” he stated. “If one customer is a little lower and another is maybe a little better, we can balance those risks, but we’re still using the same production line.”
The provider employs about 7,300 individuals in North America areas in Michigan, Texas, Illinois and New Mexico, in addition to Canada and Mexico. Its North American enterprise is liable for a few quarter of the corporate’s annual income, Stojkovski stated.
Vitesco spun off from Continental AG in 2021 and ranks No. 31 on the Automotive News listing of the highest international suppliers, with worldwide gross sales to automakers of $9.68 billion in 2022.
Source: www.autonews.com