Bulletin 391 - Friday, October 17, 2008

The American Group Pepsico, manufacturer of Pepsi Cola and Tropicana juices announced last Tuesday a plan to cut down 3 thousand 300 jobs. The Group's shares fell 7.6% to US$57.05 during the morning trading, recovering after a 10% drop. As a consequence to the real estate and credit crisis, analysts say that consumers are cutting down expenses in non-essential items. "We have suffered the impact of the continuous weakening of soft-drinks market in the United States, which led to a discouraging performance of our beverages domestic market", Indra Nooyi, Pepsico President said.

Source: Vanguardia

Monterrey, Mexico,- The Japanese Company Hitachi Chemical announced a US$25 million investment in an auto parts manufacturing plant they will install in Montemorelos, where they will employ around 400 people within 5 years. Shigero Kudo, Hitachi Chemical's CEO, said that this is the Company's first investment in North America, and will be meant to produce dish brake pads for Nissan models. These products will be later sold to other assemblers, including Ford. Kudo said that even if the North American automotive market was down in the last few years due to high fuel prices and regional economic deceleration, it still is the largest market in the world, where demand for compact cars is growing. When asked why they decided for Montemorelos, Mr. Kudo explained that it was mainly due to the support they received from state and municipal governments and from Fidecitrus, even if they had analyzed other states in Mexico.

Source: Milenio

Guadalajara, Jal,- Honda is ruling out changes in their manufacturing plans for their plant in El Salto, Jalisco, even if they will adjust production of some models manufactured in the United States. In a press release, this Japanese Company informed that as part of their global response to their customers' need, production of six-cylinder Accord will be moved from California to Alabama. The Company said that production of four-cylinder Accord will be increased at their Ohio, California facilities by mid 2009, as part of the Company's strategy to meet current demand and thanks to their flexible manufacturing network in the United States. This step will allow keeping Alabama Plant's production in the 300 thousand units per year they are currently achieving. In the last few months, lower sales of Odyssey and Pilot vans have affected manufacturing dynamism in this zone.

Source: Vanguardia

Puerto Vallarta, Jalisco- In a meeting scheduled for October 17 with President Felipe Calderon. maquilador sector will ask for a series of measures that allow increasing their competitiveness and that work as shielding before the hard economic situation, industrial leaders and analysts in the sector pointed-out. Sandra Montijo-Dubrule, Chairwoman of Maquiladoras Association, said that this anti-crisis shielding for maquilas will include reducing power rates, as well as simplification and deregulation to open and operate companies. The measures also include giving official support to local and regional suppliers aimed to cut-down costs for industrial plants, as well as strengthening logistics and infrastructure, she said. The proposal will also include reimbursement of VAT in less than 20 days, expediting international border crossing by providing equipment and more personnel for customs as well as prompt enforcement of the new Maquilador Decree. Ms. Montijo-Dubrule said that if industrial investment is to keep on flowing and if jobs are to be generated, the Government must understand that maquilador scheme is the largest option there is to support Mexican economy after more than 40 years operating.

Source: El Diario

Jalisco, Mexico,- From 2006 to date the Mexican plant of photo giant Kodak entered into a. restructure process that led to cutting down their labor force by half, reaching 2 thousand employees, even if in January 800 jobs could be recovered. The last personnel cut down took place 1 and a half month ago, when around 150 people left the Company. "There are cycles, fiscal years, we will close this year with 2 thousand (workers) and in January we start hiring 800; these are things that sometimes you cannot explain yourself", said Rafael Torres Arredondo, the company's Union General Secretary. "We have lived very good times, some not so good and some even bad; right now we cannot help but recognize there is sadness, there is uncertainty because many of us have made our careers here", said the Union leader, who has worked for the company for 37 years now. Regarding the possibility of the plant closing, Torres Arredondo said that there is an official announcement by top officers stating that at least until 2010 it stays.

Source: El Norte

Frankfurt,- The German automotive company Daimler, main heavy vehicles manufacturer in the world, announced a plan to close one of their factories in Canada and another one in the United States, in order to take their production to Mexico. Daimler's plan considers taking out of the market medium-size Sterling trucks to concentrate in a two-brand strategy, Freightliner and Western Star. As a consequence, the plant in St. Thomas, Ontario, Canada, where Sterling medium-size vehicles are assembled will close in March 2009. Around one thousand 300 workers will be laid off there, Daimler will also close the plant where Western Star trucks are assembled in Portland, Oregon in June 2010; around one thousand people work there. Trucks will then be assembled in Daimler's plant at Santiago Tianguistengo in the State of Mexico. In Mexico, in addition to expanding its plants in the State of Mexico, Daimler will inaugurate in February 2009 a new plant in Saltillo, in the State of Coahuila, to assemble Cascadia, the new trucks model under Freightliner brand. The plant will be the third the Company has in Mexico, adding to Santiago Tianguistenco's and a chassis plant in Monterrey, Nuevo Leon.

Source: Vanguardia