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CN / MEX - WEG announces expansion of motors production capacity in Mexico and China

(Bovespa: WEGE3 / OTC: WEGZY) announced investments of US$ 345 million over the next 5 years for expansion of motors production capacity in Mexico and China.

In Mexico, investments will expand local production capacity and increase verticalization, integrating the production process of the Mexican operation and making it similar to what exists today at WEG’s largest industrial plant, in Jaraguá do Sul (SC). The Project includes the construction of an iron foundry that will supply all the needs for machined cast components for all industrial electric motors frame sizes manufactured in Mexico and destined to all North America consumer markets. The planned investments are US$ 210 million over the next 5 years. In China, the plans are for investments of US$ 135 million until 2020 in the construction of a new manufacturing plant of industrial motors targeted to the Asian market, besides the additional investment at the Nantong operation. The location selected for this new plant was Rugao, a technological and industrial development zone 65km away from Nantong and 180km from Shanghai.

Mr. Siegfried Kreutzfeld, WEG’s Motors Managing Director, says “these investments are fundamental for WEG’s growth in the future, it strengthens our position in two of largest global markets of industrial electrical machines, North America and China. Furthermore, with these investments we will be able to continue growing with products increasingly advanced technology, customized to meet demands of our customers in each of the markets in which we operate”. WEG started the international production in 2000 and the motors electric unit in Mexico was one of the first manufacturing units outside Brazil. The Nantong unit, in China, was acquired in the end of 2004. Siegfried Kreutzfeld mentioned, “WEG is a different company today that we had to 10 years ago. Starting from scratch, today almost 15% of our revenue is produced in overseas plants. We intend to continue expanding this percentage”. According the executive “it is possible to be competitive exporting from Brazil and this has always been WEG’s characteristic. But having production close to our customers provides additional advantages and allows us to grow even faster”.

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