Nissan: Mexico Supply Base Ready for Luxury

CANTON, MS – While Honda’s struggles with the quality of its new Mexico-built Fit subcompact are well-documented, Nissan is unfazed by assertions the country’s supply base may not be ready for luxury-vehicle production.

In 2017, Nissan’s Infiniti brand and Daimler’s Mercedes-Benz will begin making vehicles at what will be Nissan’s third vehicle-assembly plant in Aguascalientes, 266 miles (428 km) northwest of Mexico City.

“Our oldest overseas factory (opened in 1961) is in Mexico,” John Martin, senior vice president-manufacturing for Nissan North America, tells WardsAuto in an interview here. “So she’s just over 53 years old, and outside of Mexico City, and she’s operating at full capacity this year. And we never miss a beat because of supply.”

This year, Martin can recall just one incident of a supplier impacting Nissan’s Mexico production schedule. It was a late-arriving part, although it was from a U.S.-based supplier’s local plant, he says.

“(It was a) simple problem (that) affected a lot of OEMs, (but it) didn’t affect me that much, because (we’ve been) there a long time,” Martin says.

Having local management has been the key to Nissan limiting issues, he believes. “I’ve got a Mexican vice president (and) I’ve got a Mexican management team down there. They’re very competent. They know the ways, the means, to get things done in Mexico. That’s the case. So we have no issues at all.”

That same management team in place for the Aguascalientes 1 and 2 plants is overseeing the launch of Aguascalientes 3.

“It will have the same management desk, so we see no problem at all,” Martin says, adding that Nissan and other manufacturers already are building mass-market cars with plenty of luxury content.

“The distinction between luxury and near-luxury – it’s almost blending,” he says.

WardsAuto was first to report in May 2013 that Nissan Mexico will assemble Mercedes’ CLA sedan and a new small Infiniti CUV, expected to be called the QX40, off the CLA platform.

The plant also will build Mercedes’ A- and B-Class models.

Martin promises all the vehicles built at Aguascalientes 3 will be “very uniquely styled” with “very, very high levels of perceived quality.”

Nissan is no stranger to manufacturing in locales others may view as undesirable.

The automaker raised eyebrows 11 years ago when it opened a plant here in this small Mississippi town near Jackson.

After some early quality issues, involving workers wearing belts and other sharp objects that scratched Titan fullsize pickups coming off the line, the plant us now as buttoned-down as Nissan’s other North American facilities, Martin says.

However, he admits it’s a struggle to find workers with the right skills, either because of insufficient education or because of qualified workers fleeing the state.

An announcement by Governor Phil Bryant last week that Mississippi would offer free technical college tuition to high-school graduates with a C average or better is a start toward fixing the first issue, Martin says.

“That was based on some discussions we’ve been having with the administration here in Mississippi, where the governor knows he has challenges in terms of education. He’s spending a lot of time, effort and money trying to fix them.”

Nissan also is bending the ear of Bryant on the need to keep home graduates of the state’s top universities, Ole Miss and Mississippi State.

“We will take them on, we will mentor them (and) partner them (up) with very experienced auto engineers,” Martin promises.

Luring Nissan workers from other states to Mississippi also has been a bit of struggle, but Martin says once they arrive they don’t want to leave.

“There’s a perspective if you will, a retro perspective almost, of Mississippi…that it’s not good to live in,” Martin says, adding many transferred Nissan employees primarily worry about finding good schools for their children.

“When those people do find good schools, and good schools do exist – good and bad schools exist in all the states – it’s harder to get them to move out of the South.

“They find the common, decent courtesy they find down here (welcoming, and) that’s basically now lost in some of our big cities.”

[email protected]