Português
Joinville, March 21, 2023 – Tupy S.A. (“Company”, B3: TUPY3), hereby announces to its Shareholders and the market in general the new partnerships entered with Class 8 truck manufacturers in the North American market and pickup vehicles for South America. The partnerships consist of the supply of new generations of engine blocks and cylinder heads, including, in addition to casting, machining and pre-assembly, which are some of the services provided for in the Manufacturing Contracts managed by the Company.
These initiatives reflect the strategy of supplying higher added value products, which will be boosted by MWM Tupy do Brasil’s portfolio, as well as production localization trends that take place in North America due to the USMCA, but also in Brazil and region.
The new contracts have an initial duration of eight years and production shall begin gradually as of 2024. When reaching the full contracted potential, they are expected to generate additional revenues of R$650 million per year.
These new partnerships increase the Company’s share in the heavy truck market (Class 8), a segment with high volume and great resilience. Furthermore, they show the positive impact of USMCA – the new free trade agreement signed by the United States, Mexico, and Canada – for Tupy. These products, previously supplied from other regions, will be manufactured in the Mexican plants, therefore, will meet regional content requirements. This is a great solution for customers seeking to locate their supplier base closer to their markets (nearshoring). Likewise, the operations in Brazil will attend 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.
The products and services covered in these contracts will be produced at Tupy’s plants in Mexico and Brazil. For that, in the next three years, around R$340 million should be invested to prepare and expand our operations to meet the growing demand for high-added-value services. This amount includes investments in new technologies to accelerate the digital transformation of the operations.
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