Dayco ahead of schedule in N.A. after opening new Mexico facility

SAN LUIS POTOSI, Mexico—A little more than a year after breaking ground on a 72,000-sq.-ft. drive belt production plant in Central Mexico, Dayco is beginning to reap the rewards of its $11.5 million investment.

The 75-person San Luis Potosi facility—which began production on serpentine belts across three manufacturing lines in January—is a product of tax-friendly free trade agreements, regionalization and a strong, qualified labor market.

"Our geographic locations ideally help us to serve the North American market, but our flexibility and capability in building different types of belts helps us to serve customers for all regions," Dayco CEO Craig Frohock told Rubber News. "This is a large, well-known industrial park in Mexico that is prominent with many businesses. We saw it as the most ideal location for building a new facility that could serve the N.A. market, as well as other regions, too.

"Local authorities were extremely helpful in ensuring all went smoothly and we are very pleased with the pool of qualified talent in this area."

Dayco is eyeing major growth in several drive belt markets in North America, in addition to automotive (including hybrid EVs), agriculture and industrial products like water pumps, tensioners and pulleys.

"Our serpentine belts are used specifically for the automotive and heavy-duty industries, though we are experiencing market growth (in) front-of-engine components ... along with serpentine belt kits and timing chain kits for various vehicle applications," Frohock said. "We are also growing our belt lines for industrial machinery and powersports vehicles."

The new location will ramp up to full production this spring with a first shift, incorporating a second shift this summer and a third shift by winter 2025. The facility boasts state-of-the-art machinery that can produce up to 4.2 million poly-V belts annually.

"Currently we are running three lines of serpentine belts up to 4 meters," Frohock said. "However, the facility is also capable of producing CVT belts (used for ATVs, UTVs and snowmobiles), timing belts and even proprietary belts for OE customers.

"We also intend to launch an additional line next year that will have the ability to produce EPS belts."

Dayco's processes are proprietary.

"We use a combination of different production methods to ensure the highest quality product," Frohock said. "We utilize the highest quality rubber, EPDM, polymer compounds, carbon fibers, aramid and more, so that our belts provide longer lasting performance, excellent temperature resistance, less slippage and reduced noise and vibration."

Construction of the facility, which expands Dayco's footprint in North America and across the globe, was completed early after breaking ground in November 2022.

By August 2023, the building was erected. By September last year, a freshly recruited production team took its training to Argentina, preparing for the first prototype belts to be produced in San Luis Potosi at the end of November 2023.

With everything progressing ahead of schedule, the first production belts began being manufactured in January. A grand opening ceremony took place Feb. 27.

"We are very grateful for the help and enthusiasm selflessly given by everyone involved in this massive project," Frohock said. "This amazing commitment will allow Dayco to continue to serve its customers both efficiently and effectively over the long term.

"In addition to the strategic location of this new facility and the benefits of Mexico's free trade agreements, the key to the success of this project has been the vision we have had and the people behind it."

The well-being of the Dayco family that works at the facility was of "paramount importance" in the overall project, Frohock said.

"By considering the needs of our people first and including different amenities such as a nursery room and a gym, we have developed an environment which exemplifies our core values and operating principles and allowed us to create a great working culture in which everyone supports and believes in each other," he said.

The plant also boasts a terrace with a grill, an open work space and modern furniture.

"We know the labor market is very competitive in the area so we really wanted to set the benchmark for employees, offering a great working culture within a best-in-class working area," Frohock said.

The "pre-training" at a Dayco production location in Argentina prepared workers for the production work in San Luis Potosi, Frohock said.

"We sent our newly recruited workers to the Dayco facility in Argentina for close to three months, so they could see the production process and better understand what their roles would be at our new plant, as well as experience Dayco's manufacturing processes and best practices," he said. "The team proved to have a fast learning curve, as they were tested in each of the operations and all passed successfully.

"This was truly a great bonding experience and created a sense of belonging and coming together as one Dayco for this new facility. This first crew of workers also became the ones to train the new generation of workers in Mexico successfully."

Globally, a majority of Dayco's belts are manufactured at the company's three locations in Italy. The company also has facilities in China.

"So this new facility is a major milestone for us in terms of having belt production in North America to continue supporting our OE and aftermarket customers over the long term," Frohock said. "We are excited that the location of this plant will allow us to shorten Dayco supply lines and enable a quicker turnaround time on product orders."

Dayco has sales in the $150 million range annually, with more than 40 locations in 22 countries and more than 3,600 employees in total.

The company is based in Birmingham, Mich., and was founded in 1905 in Dayton, Ohio.

"In addition to the team on the ground in Mexico, many people in the Dayco family have supported this project from around the world, and without them, the successful completion of this facility would not have been possible," Frohock said. "So, our special thanks go to all our global team members."