Business model with higher value-added services offering attracts new Manufacturing Contracts to Tupy and expands revenue generation

From operations in Brazil and Mexico, the Company increases its presence in markets with a growing need for local production

Tupy announces new partnerships with Class 8 truck manufacturers in the North American market and pickup trucks for South America. This is the supply of new generations of engine blocks and heads, including casting, machining and pre-assembly, which are some of the services that integrate the Manufacturing Contracts managed by the Company.

The addition of these new items to Tupy’s portfolio reflects production localization movements, which occur in North America due to the USMCA, but also in Brazil and the region.

“The added competencies with the acquisition of MWM in the management of Manufacturing Contracts contribute to expanding the base of products sold with greater added value throughout Tupy’s portfolio,” said Fernando de Rizzo, CEO of Tupy.

The new contracts have an initial duration of 8 years and their production should start gradually, from 2024. The estimate is that, when they reach their full potential, the new partnerships will generate additional revenues of R$650 million per year.

“The investments for the expansion of manufacturing contracts are important for our customers, both in the management of their supply chain and in the allocation of capital,” explains Ricardo Fioramonte, Commercial Vice President of Tupy.

These new partnerships increase the Company’s participation in the heavy truck market (Class 8), a segment with high volume and great resilience. In addition, the addition of these new items to Tupy’s portfolio demonstrates the positive impact of the USMCA – a new free trade agreement signed by the United States, Mexico and Canada – for Tupy. These products, previously supplied from other regions, will be manufactured at Tupy’s plants in Mexico and thus meet regional content requirements. This is a good solution for customers looking to locate their supplier base closer to their markets (nearshoring). Similarly, operations in Brazil will meet the demand for machined and pre-assembled engine blocks for leaders in the local pickup truck market, which are currently supplied by engines from other regions.

 Investments in Mexican and Brazilian plants

The products and services included in these contracts will be produced at Tupy’s plants in Mexico and Brazil. For this, in the next three years, approximately R$340 million should be invested in order to prepare and expand our operations to meet the growing demand for high value-added services. This value includes investments in new technologies to accelerate the digital transformation of operations.

 About TUPY

A Brazilian multinational company that develops and produces structural components in cast iron of high geometric and metallurgical complexity. These engineering solutions are applied in the transportation, infrastructure, agribusiness, and replacement and energy generation sectors and contribute to people’s quality of life by promoting access to health, basic sanitation, drinking water, food production and distribution and global trade. Its production is concentrated in Brazilian factories, in Betim/MG, São Paulo/SP and Joinville/SC, and abroad, in the cities of Aveiro, Portugal, and in Saltillo and Ramos Arizpe, Mexico. In addition, it has commercial offices in Brazil, Germany, the Netherlands, Italy and the USA. www.tupy.com.br