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SC and SCOA Join Forces with Noble International to Establish
Noble Summit Metal Processing in Mexico
New Joint Venture Supplies Laser Welded Steel Blanks to Auto
Manufacturers; SCOA Joint Venture Hirotec Mexico S.A. de C.V. to be key customer.
Sumitomo Corporation of America and SCOA, along with Noble International,
Ltd., recently opened a factory in Silao, Mexico that will supply
laser welded steel blanks to auto manufacturing plants in Mexico.
Under the agreement, Sumitomo and Noble have created a new entity,
Noble Summit Metal Processing de Mexico S. de R.L. de C.V. ("Noble
Summit"), with Sumitomo Corporation and SCOA holding a 49 percent
interest in the venture. Noble will retain the majority stake and
manage the 60,000 square feet facility.
The new company will be SC's first foray into the laser welded
steel busines in North America. The new factory will be a supplier
to among other customers, Hirotec Mexico S.A. de C.V., a SCOA joint venture company
that is also based in Silao.
An opening ceremony was held December 15, 2005 with executives
from Noble, SCMX, and SCOA in attendence. Toshihiko Kaji, SVP and
GM SCOA, Steel and Non-Ferrous Metals Group, was among the executives
to speak.
"Noble Summit is positioned to expand blanking and laser welding
in Mexico, in what may be the most promising market for the automotive
industry," said Mr. Kaji in his remarks. "We are delighted
to have joined forces with such a prestigious company."
Laser Welded Steel
Laser welding technology was originally developed for military
use and found its way into civilian products in the 1980s. It has
become increasingly popular in the automotive industry because of
the greater dimensional variation, increased rigidity and lighter
weight of the laser welded parts compared to conventional blanks.
By the end of 2008, there is projected to be an average of seven
laser welded blanks per vehicle up from 2 in 2001.
Laser welded blanks are created by joining flat sheet metal blanks
of varying thicknesses, alloys, and coatings into one piece using
laser welding systems. It is an attractive niche in the steel industry
because laser welding has strong margins and the cost of the steel
is usually passed on to the automobile manufacturers.
Noble International has about 40 percent of the market for laser welded steel and
is the largest supplier of laser welded blanks to the North American automotive
industry. They operate four other facilities with a total of 29 laser welding systems
that are capable of producing nearly 20 million laser welded blanks annually.
Noble and SCOA have been working together since 2001. In 2003, they established a strategic
alliance and opened a steel blanking entity, SET Enterprises in Warren, Michigan that converts
rolled steel into flat blanks for a nearby Noble laser welding plant.
In addition, SC and Noble have plans to open another laser welding plant outside
of North America later this year or in early 2007.
Hirotec Mexico S.A. de C.V. to be a Key Customer
Created in 1998 as a joint venture among three companies (SC, Hirotec Corporation, and
Budd Company, one of the top U.S. automotive suppliers), Hirotec Mexico S.A. de C.V. currently has contracts with
auto manufacturers General Motors, Ford, DaimlerChrysler and Nissan with its plant in Silao, Mexico.
AVENETC provides unique products to the automobile manufacturers including whole doors, roofs and fenders
which are usually produced in an automaker's plant
Hirotec Mexico S.A. de C.V. has consistently been a top supplier to the General Motors
plant in Silao where GM builds large trucks, SUVs and pickups like
the Chevrolet Avalanche and Suburban, Cadillac Escalade and GMC
Yukon. General Motors requested that Hirotec Mexico S.A. de C.V. supply the laser welded
blanks, and this was the impetus for the creation of Noble Summit.
The laser welding process works like this: rolled steel is converted
into flat-sheet blank slits that are laser welded by Noble Summit.
Those laser welded blanks are delivered to stamping plants (Hirotec Mexico S.A. de C.V.
is a steel stamping plant). Once finished at the stamping plant,
it is then ready for the assembley line at the General Motors plant
in Silao.
Sumitomo and the Mexcian Steel Market
With the establishment of Noble Summit, Sumitomo and its subsidiaries
are now the only integrated steel service provider in Mexico's automotive
industry among the major Japanese trading houses.
Sumitomo Corporation steel related subsidiaries in Mexico incude
steel service provider Servilamina Summit Mexicana, located in Queretaro,
Mexico; FEG de Queretaro, a die manufacturer and press stamping
plant also in Queretaro; and the laser welding blanks of Noble Summit
in Silao.
Each of the subsidiaries are strategically located in the central
area of Mexico where automotive manufacturers including VW, Nissan,
GM, Ford and DaimlerChrysler all have factories and assembly facilities.
They are also located close to manufacturer's tier-1 or direct suppliers
where they can be an integrated service provider for value added
business.
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