Mexico“s Vitro SA is studying the option of opening a glassware plant in China to be closer to customers manufacturing coffee makers, blenders and other products there.
“We“re thinking of opening o…
Mexico“s Vitro SA is studying the option of opening a glassware plant in China to be closer to customers manufacturing coffee makers, blenders and other products there. “We“re thinking of opening operations in China to be closer to our customers, but it“s not a done deal yet,” Alvaro Rodriguez, chief financial officer for Vitro said 18 May 2004 during a credit conference sponsored by Bear Stearns. The Monterrey-based company is undertaking a feasibility study to determine whether it would make sense to open a glassware plant in China. Rodriguez declined to say which customers Vitro hopes to work with there. Vitro“s decision to consider manufacturing options in Asia comes amid increasing concern that Mexico“s manufacturing sector is losing competitiveness to China“s cheaper labor market. In recent years, dozens of manufacturing plants have relocated to China from Mexico. However, Daniel Lerner, an analyst with Bear Stearns, recommended caution. “With so many flocking to China they might find that the productivity of labor is not what was expected,” Lerner said. Vitro is one of the world“s largest glass companies, with annual sales of more than USD 2 billion in 70 countries. A plant in Asia would help the company diversify its sales territory, which at present is concentrated on Mexico and the US.