On an international scene of complex conditions for economic development, Aguascalientes continues to be one of the most attractive states to invest in. Numbers verify this fact: as at the end of the first quarter of 2020, a total of USD $3.452 billion of Direct Foreign Investment (FDI) had been accounted for, an amount that exceeds by 18.6 percent what was generated by the previous administration.
According to official information, from January to June this year, an investment of USD $227 million was received mainly from the United States, Germany, Spain, Japan, and the United Kingdom.
This is the consequence of economic promotion and diversification efforts made by the State Government on a permanent basis which have drawn the attention of many companies overseas.
Specialized labor, a dual education system, the highest number of research centers per capita in the country, the connectivity offered by the two main railroad lines, public safety, and the quality of life were some of the strengths that ReNeuvo Group saw in Aguascalientes to start an industry and inject between 50 and 60 million dollars into it. The state was chosen over Querétaro, Hidalgo, San Luis Potosí, and Guanajuato to receive the investment that will create 500 jobs in the medium term.
“After evaluating and analyzing the five potential states where we would establish our operation in Mexico, we concluded Aguascalientes offers the best combination of manufacturing infrastructure, a market driven by the export of products of the highest quality, highly qualified labor, and the industrial foundations that this project demands,” said Jose M. González, President of ReNeuvo Group.
In early September, after several months of nonstop work, the Department for Economic Development (SEDEC) publicly announced the creation of a new industrial park that will provide services to Tier-1 and Tier-2 suppliers of the automotive, aerospace, and agribusiness industries.
“Long before the coronavirus arrived, we established communication with the Mexican Embassy. We held many meetings with representatives of various states of the country and after several months of hard work and complications brought about by the health crisis, we were able to make headway with this project. We are very excited to be in Aguascalientes because, ever since day one, the Government offered us close guidance and helped us meet our needs. This is one of the reasons we are here,” mentioned González.
ReNeuvo Group is an Ontario-based company, founded in 2010, whose core business consists in generating industrial-grade plastic products from reused rubber and other waste products using advanced technologies and eco-friendly processes. Its commitment to the environment is such, that it has been acknowledged as one of the first global organizations to run a 100 percent paperless operation.
The Development of a Green Industry in Aguascalientes
Today’s linear production, which began during the first industrial revolution, has become unsustainable. The World Bank warned that if things remain the same in terms of population growth and consumption, by 2050 we will need three planet Earths to survive.
Many large economies have started to follow a Circular Production Model that demands the use of materials of a product from its creation to its disposal, reutilization and reintegration into a new circuit to close the cycle. No industry is exempt from modifying its processes.
Within the next ten years, the automotive industry will experience a deep transformation. Carmakers will be entirely different from what they are today. Technology will lead this change to meet the requirements of tomorrow’s society.
ReNeuvo is a company that has managed to anticipate this paradigm shift and has succeeded in developing a product made of 100% reprocessed, recycled tire rubber crumb and post-industrial plastic. It has become a major supplier of components to different sectors like the auto industry, which is the most important consumer of thermoplastic elastomers (TPE).
XyloX is the name of thermoplastics created at a molecular level using a patented, innovative formula that gives the final product certain advantages over virgin plastic such as the cost of production, resistance, and malleability. A product that will soon be manufactured in Aguascalientes.
“Almost 65 percent of recycled PET produced in Mexico is sent to China, where it is transformed and sent back as synthetic fibers. Why not produce it in Mexico? We want to collaborate with existing suppliers in Aguascalientes and in other states. From the moment we submitted the press release of September 4th, we have received a number of offers and proposals. So, as soon as we receive the State Government’s proposals we will conclude the valuation and make a final decision to continue working with the Government of Aguascalientes in this great project,” said González.
Nine Plants to Trigger a New Industrial Era in Aguascalientes.
The project considers the creation of a new industrial development, the ReNeuvo Canadian Industrial Park. Thanks to the conditions offered by state authorities, the park will be completed in three years at the most.
The site will accommodate nine plants in a first stage, and the number could grow to reach twenty in a second one. There will be a plant owning and administering the park, a rubber processing plant, a XyloX manufacturing plant, and even a research & development center. The firm’s president explains that once these plants have been established, they will have a capacity to process around 24 million tires and as much as 54 thousand tons of recycled plastic every year with modern, highly secured technology that gives priority to sustainability.
This project will offer both the state and the country many advantages, from the hundreds of direct and indirect, high-quality jobs to be created for the construction and operation of the facilities, to the professionalization of workers in alliance with local and national universities. Nevertheless, beyond economic benefits, the project will achieve environmental success that will allow us to put ourselves on a par with the most developed economies.
“At first we were thinking about establishing only a few companies in an existing industrial park. However, we soon realized that this approach was expensive and decided to commit ourselves to the creation of our own park. We understood, too, that, with this infrastructure, it makes sense to attract other Canadian companies to establish their operations in Mexico, said company President, José M. González.
A Megaproject No Pandemic Can Stop
The covid-19 pandemic affected global supply chains in a way that had not been seen in a long time.
For ReNeuvo, the health crisis made it impossible to hold very important in-person meetings in Aguascalientes. This became a good time to turn the problem into an opportunity to plan strategies to face the virus that has challenged world economies.
“In business and social contexts we are going through harsh times. We had plans to be in Mexico in March and we were forced to call them off. Instead, we had to hold videoconferences with state representatives and, in spite of the distance, we were able to materialize the investment. It is a clear demonstration of our adaptive capacity and our commitment to Aguascalientes,” concluded González.