Virginia Economic Development Partnership
Brenco Inc. Secures 10-Year Mexican Contract
-- Governor Allen Congratulates Petersburg Bearing Manufacturer --
Petersburg - Governor George Allen today announced that Brenco, Incorporated, a manufacturer of railcar tapered roller bearings, has signed a long term, 10-year sales contract with Compania Industrial AZO of Mexico worth an estimated one million dollars during the first year. Additionally, Brenco will remain the exclusive distributor of roller bearings for the next nine years, leading to a total estimated value of $10 million.
"Like the powerful locomotives it helps to move, Brenco is a driving force in our rolling Virginia Renaissance. Today's contract makes Brenco the exclusive distributor in Mexico of this key component of railroad freight car wheels for the next 10 years," said Governor Allen. "The contract between Brenco and AZO also underscores the benefits of our international trade missions which have resulted in over $176 million in new investment and sales, created hundreds of jobs and kept hundreds more employed here in Virginia."
Governor Allen and his State economic development officials arranged the first meeting with Brenco and AZO during his 1994 trade mission to Mexico. The initial meeting won Brenco a one million dollar contract from the Mexican government railway, FNM. Although Brenco has continued to successfully sell its products to AZO since 1994, the company hopes to increase its sales to Mexico as the country's railroads privatize and improve.
Brenco Inc., was founded in 1949 and currently employs 750 people worldwide. The Petersburg facility operates three shifts and maintains a workforce of 616 employees. Through this new contract, the company hopes to obtain at least 50 percent of the market share for all tapered roller bearings in Mexico.
"All of us at Brenco are pleased to enter into this long term partnership with AZO in Mexico," said Craig Rice, president of Brenco. "Through this agreement, we hope to benefit from increasing rail traffic between the U.S. and Mexico as well as improved railcar maintenance practices that will result from NAFTA. We want to particularly thank Governor Allen and his administration for helping to facilitate our business development efforts in Mexico. It is a good example of a successful business-government partnership."
Mexico is Virginia's sixth largest export destination. In 1996, Virginia firms exported $342 million worth of products there, an increase from $320.8 million in 1995.
# # #