The Business Herald’s markets and banking reporter.

Motor maker opens Mexico subsidiary

Wellington Drive Technologies may establish a facility in Mexico. Image / Thinkstock
Wellington Drive Technologies may establish a facility in Mexico. Image / Thinkstock

Loss-making energy efficient motor maker Wellington Drive Technologies is growing its business in Latin America and may eventually establish a manufacturing facility in the region.

The company has manufactured its products, used in commercial refrigeration, in Asia since it shifted the work out of New Zealand several years ago. The firm has just set up a wholly-owned subsidiary - Wellington Latin America Services - in Queretaro, central Mexico, which it says aims to strengthen its presence in the region.

"The Americas is our strongest growth market and it's reached the point now where we need to provide more support into that market," chairman Tony Nowell said. "We want to put engineering resources in place to support customers."

He said manufacturing in Mexico, or possibly another Latin American country, may take place in the long-term.

F&P Appliances and F&P Healthcare already operate plants in Mexico, which is seen as a lower-cost manufacturing destination with easy access to the US.

For the half-year to June 30 Wellington reported a loss of $2.4 million - an improvement on the $3.3 million it lost in the prior comparable period - from revenue of $22.3 million. More than a decade on from its NZX listing, Wellington has failed to turn a profit.

Kiwi Greg Allen took over as chief executive late last year, replacing the long-serving Ross Green. Allen, unlike Green, runs the company from the United States.

Nowell said the firm was looking to branch out from motors into other components used in refrigeration systems.

Wellington shares closed unchanged at 15.5c yesterday.

- NZ Herald

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