Balluff strengthens supply chain resilience with new manufacturing hub in Mexico

Automation suppliers have learned firsthand over the last three years that supply chains are vulnerable to geo-political and social-economic challenges, says Frank Nonnenmann, managing director and head of supply chain at Balluff. To combat those challenges, Balluff has regionalized production for the Americas with a 75,347-square-foot facility in Aguascalientes, Mexico (Figure 1). “With our new regional set-up, we have significantly reduced our potential exposure to those challenges and, with the additional manufacturing lines coming, will continue to do so,” Nonnenmann adds. Balluff believes that business is local and regional, and so is production.

The project was fast-tracked, with multiple phases running in parallel. "The design phase of the new factory, the commissioning of the local construction company, and the contract negotiations, for example, ran in parallel," says Andreas Schönle, manager of strategic projects at Balluff. The company says cooperation between the contractor and local authorities helped the process. The project approvals came through about a year ago, with the groundbreaking ceremony in January and production starting only eight months later (Figure 2).

“Our business in the Americas region is fast growing, so additional capacity was needed, and this factory is built for that market demand,” Nonnenmann says. Today, products are predominantly imported via global supply links from Europe and China, he adds. The new regional manufacturing facility in Mexico will reduce lead times for customers in the Americas and make the supply chain more resilient against potential disruptions. The factory has regional land, sea and air-freight options across the region and will be able to respond more efficiently to customers’ product and project needs, Nonnenmann says.

“With the new factory we are also increasing our multiple-source capability across the Balluff Group. We are investing in additional assembly and test equipment and aim to be able to build the same product not only in one factory in our network, but in all of them,” Nonnenmann says. The installation of a 500 kWp photovoltaic system on the roof of the production and logistics hall is underway. This will enable the site to cover about a third of its needs with its own electricity in the future. Balluff expects to save around 350 tons of carbon dioxide per year.

The company's management is also local. Edgar Gonzalez, who has called Aguascalientes home for many years, leads the new operation site. Currently, Balluff has 70 employees in Aguascalientes, but that number will increase quickly. The fourth-generation, family-owned company fuels the future-oriented culture there and its devotion to workforce development.

“We believe that Balluff in Aguascalientes offers unique employment opportunities for our new colleagues who share that ‘Balluff spirit’ of integrity, respect, family, result oriented, passion. All new employees receive job-specific training as they on-board, and Balluff is also launching a dual-education program—a concept well known to us back home in Germany and which is now also rolled-out in partnership with local universities in Aguascalientes,” Nonnenmann says.

Teams of experts from Hungary, China and Germany trained the employees in Mexico before the start of production. "In the past months, we have already been able to experience how well the international cooperation between the various Balluff locations works and we have benefitted from the experience of our colleagues," Gonzalez says. "Our colleagues have worked very hard for us. We clearly felt the special Balluff family spirit: everyone working together."

Following the successful start of production, Balluff will gradually expand manufacturing in Aguascalientes, including additional assembly lines for sensor and network technology. Balluff wants to employee 100 people by the end of the year and 700 by 2027. An additional 118,402 square feet of factory space is available for expansion in phase two, with decisions about plans for that space coming by the end of 2025.