Martinrea (TSX: MRE) is an diversified and global supplier, engaged in the design, development, and manufacturing of highly engineered, value-added lightweight structures focused primarily on the automotive sector. The company competes primarily in the light vehicle segment of the global auto parts industry with a principal focus on North America and has operations in Europe and Asia. Martinrea operates in a business, which is impacted by various economic, industry, and technological trends.
High-quality operations
The company’s operations have always focused on quality. Martinrea has adopted a key strategic principle that quality processes and procedures will continue to be improved and streamlined to maintain world-class status. The goal is that each division within the company has zero product or process defects and flawless launches. The company has received multiple product and plant quality awards over the years, including top supplier quality awards.
Excellent management
The company is led by entrepreneurial management who works on ensuring Martinrea consistently achieves high economic returns through investment in technology, equipment, manufacturing processes, and people. The company has assembled an excellent automotive executive management team. The company also embraces diversity and inclusion within the organization and the different perspectives diverse and inclusive thinking can bring that can give the company a competitive advantage.
Technology powerhouse
The company embraces new technologies and materials and has invested heavily in novel technology, equipment, and manufacturing processes. Martinrea maintains leading edge research and design, testing, and advanced product development operations.
The company has consistently developed more efficient and effective ways to utilize technology. The company develops new technologies and integrates world-class technologies in hydroforming, fluid systems, and machining. Martinrea’s investment in NanoXplore, and the company’s focus on graphene is a recent technology initiative.
Decentralized organizational structure
The company’s operations are organized on a generally decentralized basis with common principles. Each product area and manufacturing facility operates on a separate, autonomous basis, geared to becoming a centre of excellence in a product area. This system empowers and provides incentives to management and employees at each facility.
Each facility is run by a general manager with manufacturing and production experience who has discretion to make operational decisions. The company also has a manufacturing system focusing on operational excellence and lean thinking to develop and utilize best practices for all divisions on a consistent basis that is continuously updated and improved.
Diverse customer base
The company has significantly increased the customer base, both organically and by acquisition. The hiring of senior and experienced automotive executives has also fostered business growth. The company’s technological skills and efficient production methods are especially well suited to the outsourcing supply business. There could also be substantial opportunities to develop applications for the company’s engineering and production skills.
Expanded business development
Martinrea has substantial selling opportunities and can continue to increase sales over time through an increase in the number, size, and scope of contracts. The company has manufacturing capacity throughout North America, Europe, and Brazil to better service customers.
The company is also pursuing growth opportunities through strategic relationships. This could provide opportunities for broader geographic penetration and product capability in the future.
