Joint venture in Mexico

In January 2015, the Coatinc Company Holding (TCC) assumed a 49 percent share of a US corporation headquartered in San Diego, California. In the future, this corporation will operate galvanizing facilities that are currently being built in the Tijuana Municipality in the Mexican state of Baja California. The galvanizing plant will be launched under the name Galvanizadora California. An American corporation by the name of California Galvanizing and Steel Structures will undertake the sales.

The galvanizing facilities will use a kettle of 17.5 meters long. A monthly output of 4,000 tons is expected. The US market should be served up to 90 percent, predominantly in the automotive, solar energy, and steel and metal construction segments. However, development of the Mexican market should be reinforced too.

José Antonio Barrera, the new joint venture partner with a share of 51 percent and also the managing director of the company, has many years of expertise in galvanization in Mexico and was also the president of the Mexican galvanization association in the past. His many years of extensive experience should secure the success of the investment. His wife, Elena Maria Barrera, will operate the company’s own vehicle fleet and be responsible for transport and logistics, especially for delivery in the USA.

A plot of land of approximately 120,000 sq. m has already been acquired. This will be a small industrial park with production areas that metal and steel construction companies can lease in the future. These companies, called maquilas, which manufacture products that require galvanization at Galvanizadora California, produce for the US market and export to the USA under NAFTA (North American Free Trade Agreement) conditions. Therefore, Galvanizadora California will become one of the most significant providers for galvanization services and a driving economic power in its region.

This new joint venture represents another consolidation of TCC’s portfolio strategy in growth markets. After the investments in Turkey, the Czech Republic, and Slovakia, being able to cooperate on-site with an experienced partner is important for the internationally active group.

“This investment is characteristic of our company strategy, which keeps our family company’s survival at the fore and thus aims for broad positioning,” says Paul Niederstein, Managing Director of TCC, now in its 5th generation. “In this case, investing in Mexico, a market that is intended to serve as a backup in case of a worsening economy in our core markets of Germany, the Netherlands, and Belgium, will allow us to overcome any economic downturns. The shareholdings very decisively contribute to TCC’s ability to compete – and, thus, the security of jobs in Germany too.”

The family-owned Coatinc Company Holding, which has existed since 1885, operates plants in eight locations in Germany and 10 more locations in the Netherlands and Belgium. The group employs around 1,000 employees in 18 100 percent subsidiaries. In addition, TCC holds 10 shareholdings in companies in the growth markets of Turkey, the Czech Republic, and Slovakia, and also in its core markets in Germany and Benelux. The spectrum of services covers all galvanization procedures (normal- and high-temperature galvanizing, spin galvanizing), powder and wet coating, duplex processes (galvanizing plus powder or wet coatings) as well as other coating technologies (anodic oxidation, electrolytic oxidation of aluminum, and zinc flake coating).