Fibergrate built the plant in Querétaro in 2008 to better support customers in Mexico and further expand into Central and South America. “It’s proven very successful,” says Breiner. The facility has 225 employees and is outgrowing its space. By the end of the year, Fibergrate will finish construction on a 40,000-square-foot addition to its 85,000-square-foot Mexican plant.
Barriers to Crossing Borders
Operating international facilities may be prudent and profitable, but it also can present challenges. Breiner says finding quality raw materials is problematic, so Fibergrate ships many of them to Querétaro. “Until the Mexican economy develops to the point where major suppliers have operations there, [sourcing materials locally] has created some challenges for us and, honestly, a cost impact,” he says.
In addition, there can be customs-related headaches. Gill’s division in Northern Ireland contends with discrepancies in tariff codes between the United Kingdom and the United States. Gill is required to pick a tariff code for U.S. exports of raw materials to its Belfast plant. But the U.K. frequently challenges Gill’s classification of parts imported from the U.S. as “aircraft parts” and suggests various commercial classifications.