GIS invests 30 million dollars in its Draxton San Luis Potosí plant

San Luis Potosi

By Elenne Castro

GIS announced a new investment of 30 million dollars for the expansion of the capacity of its auto parts foundry plant of its Draxton business in San Luis Potosí, which will start operations during the last quarter of 2022.

Draxton is a company dedicated to the casting and machining of critical auto parts for brake, engine and chassis systems for the auto parts industry,  and has operations globally in six countries on three continents: Europe, Asia and North America with strategically located plants to the center and north of Mexico.

The company reported that the construction and expansion of a new nodular iron smelting line at its production plant in San Luis Potosí will increase its installed capacity by 30,000 tons per year to reach about 620,000 tons per year of foundry globally.

The new foundry line will be focused on the production of calipers and brackets, critical and safety parts for the brake system that are 100% compatible with hybrid and electric vehicles, which allows this division to participate in the electrification of the industry. automotive globally.

Jorge Rada, director of operations of GIS, pointed out that the financial strength of GIS allows them to generate their own resources for the expansion of this company, and with this, they are ready to take advantage of the business opportunities presented by the Free Trade Agreement between Mexico, the United States and Canada (T-MEC) for the automotive industry.

In addition, GIS  announced that it achieved the refinancing of the loan contracted for its Evercast foundry and machining business , with a cost reduction and an extension of the term until 2026.

“Additionally, we have executed advance payments to the syndicated loan for 13.6 million dollars contracted by GIS, thus achieving no repayments during 2021 and 2022; This allows us to reduce the level of debt leverage, improve maturity profiles and have flexibility to analyze growth alternatives and value generation for our business portfolio ”, he concluded.

GIS is a global company of Mexican origin with 18 plants : 10 in Mexico, seven in Europe and one in China that serves the markets: automotive, construction and home.