Freightliner Plans Mexican Truck Factory

Posted on December 20, 2006

Freightliner LLC announced its plans to build a $300 million plant in northern Mexico. The company, a division of DaimlerChrysler, expects to break ground on the planned 1 million sq. ft. site in the second quarter of 2007, with production expected to start in 2009. The facility in Saltillo, Coahuila, will be able to build up to 30,000 commercial trucks per year and will employ 1600 people, the company said in a statement. The Portland, Oregon-based truckmaker said it is building the plant in anticipation of a rise in demand in 2009, when a new round of U.S. emissions regulations aimed at trucks will take effect.

“This new facility underscores our confidence in the NAFTA truck market, and our bullish mid-term outlook for industry recovery post-2007," said Freightliner LLC President and CEO Chris Patterson. "Frankly, we were not able to produce what we could have sold in 2006 due to capacity constraints. We expect another surge in customer demand in 2009 prior to the next round of EPA emissions regulations, and the construction of this new plant will ensure that we are fully prepared."

The Saltillo plant is the second Freightliner LLC manufacturing facility to be located in Mexico, joining the Santiago Tianguistenco plant which produces Freightliner-branded heavy- and medium-duty trucks for domestic Mexico sales as well as export to Latin America, the United States and Canada. The new facility will be located near an existing Chrysler plant. The 740 acre site will also include a PDI/transporter center and test track, as well as room for future expansion.

The announcement comes just over than two weeks after the company announced plans for production rate adjustments at its truck manufacturing plant in St. Thomas, Ontario, that will result in the idling of 800 employees. The company said that move was the first in a series of such measures that will affect all the company's vehicle and component assembly plants during the first quarter of 2007. As many as 4000 production and related workers may ultimately be affected.