New Kuka Mexico plant targets special orders
Nuevo León, Mexico factory part of strategy of global manufacturing diversification
Upholstery major Kuka Home is expanding its global manufacturing footprint with a new upholstery plant located in Monterrey, Mexico. The new facility will focus on special-order stationary upholstery for the North American market.
The Mexico plant, where equipment is currently being installed, will open with an initial 130,000 square feet of production space and 250 employees. Kuka aims to expand that to 750,000 square feet and 1,500 workers within the next five years.
“We’re starting out shipping to a couple of existing dealers with existing models and a limited cover selection — 15 or 20 — and fabric only initially,” said Steve Lush, president of Kuka Home North America. “We’re starting small on purpose to ensure our quality standards are met.”
Initial production should be 23 to 30 truckloads a month.
“As the factory gains experience, we’ll expand shipping to more dealers with more models and up to 100 truckloads a month by the end of the year,” Lush said. “We’re looking at an ultimate capacity of around 600 truckloads a month. This will serve what we feel is a growing part of the market: special orders with fast delivery capability.”
Kuka’s goal with the Mexico plant is a three-week production cycle and week to week-and-a-half transit for a total of four to five weeks’ delivery to the door. While the facility will produce fabric upholstery only to start, leather production should come online by 2021.
The Monterrey factory will begin production with in-line goods, but Kuka plans to develop new products exclusive to the Mexico plant by April High Point Market.
“We chose Monterrey because it has a highly-skilled workforce
,” Lush said. “It’s an ‘aspirational’ city, as well; people want to move there.”
He added that the government of Monterrey’s home state, Nuevo Leon, has been very helpful in the development of the new upholstery plant, from site research to assist in the training of workers.
A larger plan
The Mexico plant “is part of our long-term vision to become a global manufacturer,” Lush said. “We started this process a year ago when we started our motion facility in Vietnam, which is now shipping 300 containers a month.”
In addition to expanding shipments from that current 300,000 square-foot leased facility, Kuka has purchased 45 acres north of Ho Chi Minh City where it will start construction this year on a 400,000-square-foot motion plant with room for additional growth.
“The ultimate capacity of this facility is 1.5 million square feet, and 1,500 containers a month,” Lush said of the new Vietnam plant.
Kuka also will continue production at its two plants in China.
“We currently have special-order capability in China, but as you can imagine, the lead times for the U.S. market are much longer than for a factory in North America,” Lush said. “Regardless of which factories make our products — China, Vietnam or Mexico — the same standards and quality assurance we have in our original China plants are in place.”