Article based on an exclusive interview with Marcos Villarreal, Automotive, Metal and Aerospace Business Director, Adhesives and Metal Pretreatment at Henkel – Latin America North.

Q: How are US politics expected to impact Henkel’s business operations?

A: Large investments from Audi, KIA, Mazda and Honda are already formalized and new ones are on their way from BMW, Toyota and Daimler. So, in the short term there will be very little disruption to production volumes. In the mid-term, initial estimates indicate that many people and companies interested in investing in Mexico might postpone their investments and purchasing decisions.

Particularly in the consumer automotive industry, if people were planning to buying a car in 2017, they may delay that purchase until 2018. Uncertainty inevitably slows the industry down. Consumers and investors will wait and see what economic, trade and investment policies the new government will implement and what type of interaction will prevail between Mexico and the US.

Q: What is Henkel’s biggest challenge to capitalize on its growth opportunities?

A: The availability of local suppliers is an important challenge. We are still buying from many international companies, either directly importing raw materials or buying them from their local distributors. Mexico needs to keep strengthening its infrastructure and domestic supply chain, and this is for sure doable.

The other challenge we foresee is hiring the necessary human talent. We look for chemical, mechanical and industrial engineers among others. The more available talent we have for all the company’s expansion needs, the better positioned we will be to capitalize on our growth potential. Long gone are the days when we just delivered the products and then left the customer to handle them. We focus on complementing our offering with services such as chemical consultancy for customers.

This is an exclusive preview of the 2017 edition of Mexico Automotive Review. If you want to get other relevant insights regarding the Mexican automotive industry, get your copy of Mexico Automotive Review 2016.

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