Deep Roots, Winning Attitude

France is a mature market, but it continues to attract investment from American suppliers, because when the automotive industry puts down roots, they grow deep and strong.

During the Society of Automotive Engineers World Congress this month, the Invest in France organization is honoring three suppliers for their investments to expand existing facilities in French automotive regions: BorgWarner Inc., Mark IV Automotive and Cooper Standard Automotive Inc.

Why are they investing in France, when big French suppliers such as Valeo SA and Faurecia SA are making most of their new investments in Eastern Europe or Asia?

Well, Renault SA and PSA Peugeot-Citroen together made 5,886,000 cars globally last year, including 3,156,000 in France. The Renault Nissan Purchasing Organization, which buys 70% of the parts used by both companies, is based in France, while Toyota Motor Corp. and DaimlerChrysler AG's Smart unit have assembly plants in France.

Because of the heavy capital required by most suppliers, the strongest business case for new investment often is to support earlier decisions, as in the case of the companies being honored this year. U.S. suppliers have 200 plants in France with 70,000 employees.

At the same time, George Ucko, director of the Invest in France office in Chicago, says his organization now is working with several U.S.-based companies — involved with engineering and information technology-related services — considering France for the first time to try to win business from PSA and especially Renault, which has committed to doubling the number of new products it offers during the next four years. Here's what the honorees did:

BorgWarner

BorgWarner's investment of about €50 million ($60 million) between 2005 and 2007 covers the construction of a new building and the production machinery that will triple its capacity to produce the mechatronic heart of dual-clutch transmissions.

In mid-March the new 16,000-sq.-m (170,000-sq.-ft.) building was 50% complete. Production of existing products for the Volkswagen Group is expected to move in August from the current factory, in central Tulle, to the new facility in an industrial park 12 km (7 miles) away. By 2009 or 2010, the factory is expected to have reached its new capacity, and it will be time to consider another expansion, says plant manager Frederic Lissalde.

The current Tulle factory has 270 employees working three shifts. The expansion will mean hiring another 100 workers.

Tulle was the obvious choice to install new capacity because of its regional experience and knowledge. In 1995, BorgWarner purchased the SUM company there that made controls for a Renault-PSA automatic transmission, and the factory “had great know-how regarding solenoids for the transmission and engine,” Lissalde says. The current products are descendents of those earlier controls.

Mark IV Automotive

Mark IV Automotive, a specialist in air intake manifolds and engine cooling, is doubling the size of its factory in Fraize in the Vosges region of eastern France to meet booked growth of 20% annually over the next three years.

Mark IV, whose origins are in the Dayco rubber hose operation that began in Ohio in 1905, purchased the French operations of LPI Systèmes Moteurs SA in 1997 and turned them into the Air Admission & Engine Cooling division, now headed by General Manager Jean-Luc Dejean.

From his headquarters at the division's technical center in Orbey, France, he oversees three plants in Europe and one in Montreal.

One plant makes engine-cooling equipment such as plastic water pumps, and another makes air intakes, while the Fraize factory makes the parts that will connect either air intake or cooling devices to the auto maker's engine.

“These are not simple ducts; they are complete robust systems,” Dejean says. For example, a cooling-system manifold for a PSA diesel engine consolidates the thermostat housing, diesel-fuel preheater, temperature sensor and inlet and outlet ports for the radiator and heater core.

Mark IV Moteur Système's best-known product is the air intake manifold, which it produces for Renault and Nissan, PSA Peugeot-Citroen and Ford, BMW, Toyota, DaimlerChrysler, Fiat and Porsche.

Employment in France now is 920; the expansion at Fraize required 150 new hires. The success of the PSA-Ford 4-cyl. diesel engines is behind much of the division's growth, Dejean says, but a particular point of company pride is the air intake made for Porsche.

“When you see the size of it,” he says, “you know the engine breathes well.”

Mark IV's American headquarters is in Amherst, N.Y., but it is an international company with other offices in Sweden and Italy.

Cooper Standard Automotive

Cooper Standard Automotive's factory in Vitré is an institution in the Brittany region, where it has long supplied sealing products to the former Citroen factory in Rennes that now produces PSA's largest cars for both Citroen and Peugeot. Cooper Standard supplies sealing for front windows on the Peugeot 407 built at Rennes, for example.

“Cooper will be recognized for its important and long-standing presence in France as well as expansion of its activities in Vitré,” says Invest in France's Ucko.

Besides adding a new product line at Vitré, Cooper Standard has operations in Bolbec and Lillebonne in Normandy, Argentueil near Paris and, since acquiring the fluid handling systems from ITT, in Creutzwald in Lorraine.

At Vitré, the company makes rubber and plastic seals for windows and joints for body panels, hoods, doors and hatches.

French Agency to Honor Suppliers

The 11th annual Invest in France Automotive Awards reception will honor BorgWarner Inc., Mark IV Automotive and Cooper Standard Automotive Inc. April 4 at the Detroit Institute of Arts.

The Invest in France Agency assists companies contemplating business activities in Europe. Each year it recognizes North American automotive companies that have invested significantly in new or expanded facilities in France.

During the awards this year, the agency will preview an 8-minute video detailing how France remains a major production center, and that it is attracting high-technology manufacturing as well as research and development centers. It also will tout the new Competitiveness Clusters strategy recently put in place by the French government.

For the third year, Ward's AutoWorld is sponsoring the awards ceremony, held in conjunction with the Society of Automotive Engineers World Congress.