Mr. Carlos Torres

1) Today we are very pleased to be able to offer this interview with Mr. Carlos Torres, CEO of the TORSA Group and perhaps best known for his series of “Heat Treat Podcasts”. Carlos for those who might not know you could you please give us some background, the companies you are involved with and how they complement each other?

Carlos: It’s true, I wear many hats in our group of companies, and each role is a part of my journey in the heat treat industry. Growing up, I was surrounded by the hum of machinery and the smell of hot metal in our family business. Becoming an engineer was a natural path, and it led me to travel the world, meet fascinating people, and dive deep into the business. Today, as the CEO of the TORSA group, a family company my father started 40 years ago, I oversee five dynamic divisions.

Most people know me for MATTSA, which fabricates and services industrial furnaces under the AFC-Holcroft license. Crio, where I spend most of my time now, is a leading commercial heat treat company in Mexico. Then there’s Argo Steel Works, our giant that manufactures massive furnaces for various industries, and SSI Mexico, our joint venture with SSI USA. Plus, during the COVID years, I started a podcast to keep the conversation going with the best minds in heat treat, which has become a passion project of mine.

As CEO, I’m like the captain of a soccer team, ensuring each player (company) performs their role to the best of their ability while working towards a common goal. Some days, I’m on the field, actively involved in operations, fine-tuning processes, and driving innovation. Other days, I’m strategizing from the sidelines, mapping out where the industry is headed and what solutions the market will need. For instance, we are pioneering a hybrid furnace that combines electric and gas heating, aiming for cost-effectiveness and environmental sustainability. This innovation requires significant investment, but it’s all about balancing development while keeping our existing operations thriving.

2) Crio is one of the largest private commercial heat treat companies in Mexico. What strategies have you implemented to achieve and maintain this position?

Carlos: Twenty years ago, Crio was just a small heat treat shop with big dreams. Fast forward to today, and we have transformed into a powerhouse with two substantial locations, working on highly complex parts for the aerospace and automotive industries. The secret sauce? Cutting-edge technology from AFC-Holcroft and SSI, combined with a relentless pursuit of excellence. We benchmark our practices against the best, constantly updating our equipment and systems. But it’s not just about technology. Our team of metallurgical engineers is our backbone, driving innovation and ensuring we meet the highest standards. We’ve built a culture where quality is king, technology is our ally, and customer service is our mantra.

3) Mattsa is known for its partnership with AFC Holcroft of Wixom, Michigan, USA (part of the Aichelin Group). How does this collaboration work, and what benefits does it bring to your customers?

Carlos: Mattsa and AFC-Holcroft have been partners for over 20 years, a relationship that feels more like a finely tuned dance than a business arrangement. This partnership allows us to blend global innovation with local expertise. Imagine the complexity of modern furnaces—they’re like the intricate workings of a Swiss watch. By teaming up, we ensure that every cog and wheel is perfectly aligned from design to post-sale service. Most of the decisions are taken at the corporate level, but by teaming up, we ensure all the important aspects of business are taken care of from the design stage up to commissioning and post-sale service of a complex furnace line. Furnaces are getting more complex day by day, and you need an expert close by when the installation is significant—that is what differentiates us. Now that AFC-Holcroft is part of the Aichelin Group, we have an even broader range of products to offer, strengthening our position. This successful relationship allows us to provide cutting-edge solutions to our clients.

4) You have mentioned Mattsa and Crio, do you have an involvement with any other companies either in the heat treatment industry or outside of it?

Carlos: Argo Steel Works is a giant in its own right, crafting specialized steel structures for steel mills, glass, and mining sectors. Think of it as the heart of our industrial operations, pumping out robust structures that support critical industries. It’s like commercial heat treat, but on a grander scale, ensuring every part is traceable and meets rigorous standards. And then there’s SSI Mexico, our joint venture with SSI USA. It’s a finely tuned machine, so well-oiled that my involvement is minimal. SSI USA’s institutional knowledge powers our operations, ensuring we meet the high expectations of the Mexican market.

5) Your group has had a great deal of longevity over the years in that you have grown and prospered for many years now under two generations. How do you ensure that your group remains at the forefront of the heat treat industry, especially in terms of process development, furnace design, installation, and data analysis?

Carlos: Staying at the forefront of the heat treat industry requires a blend of foresight, innovation, and collaboration. For instance, when a large company plans to open a new facility, their initial plans are often loose with very limited information. The best projects are those where we get involved from the very beginning. This allows us to thoroughly plan and engineer the optimal solution for the customer.

We assess whether it’s better to outsource or conduct the process in-house, whether to relocate existing equipment, buy brand new, or retrofit non-functional machinery. This involves reviewing volumes, specifications, budgets, timelines, space constraints, industrial engineering requirements, plant talent, and the desired outcomes.

For example, sometimes customers envision fully outsourcing the material but want absolute control over the part and process. In such cases, we advise them to handle it in-house. Conversely, if a customer wants to manage everything internally but lacks the volume to justify the investment, we might recommend outsourcing as the more cost-effective option. We always aim to present the best business case to the customer, ensuring their competitiveness and success, which in turn ensures our success. Unlike furnace companies that push new sales, or heat treat shops that push outsourcing, we take a holistic approach to find the most suitable solution for our clients.

6) I have watched with a great deal of interest how Mexico has become increasingly competitive in the industrial sector-the growth just over my lifetime has been astonishing. What challenges do you face in this market, and how do you address them to stay ahead of the competition?

Carlos: Mexico’s industrial sector is indeed becoming highly competitive, but it comes with its own set of challenges. One common misconception is that Mexico is a cheap country to operate in: however, that’s far from the truth. Gas and energy costs here are higher than in the US or Europe, and taxes range between 30-40%.

To navigate these challenges, we focus on several key strategies. First, we continuously invest in the latest technologies and equipment to improve efficiency and reduce operational costs. By leveraging advanced technology, we can offset some of the higher energy costs and remain competitive.

Second, we emphasize building strong relationships with our customers and understanding their specific needs. This allows us to provide tailored solutions that maximize their operational efficiency and minimize costs. For example, advising a customer to retrofit old machinery only when it makes financial sense, or suggesting outsourcing when internal management isn’t feasible due to low volumes.

Additionally, we prioritize training and retaining top talent. A skilled workforce is crucial for maintaining high-quality standards and driving innovation. By creating a supportive work environment and offering continuous learning opportunities, we ensure our team is always ahead of industry trends and challenges.

7) What are your future plans for expansion or innovation within your group, both in Mexico and potentially in the broader NAFTA market?

Carlos: Our future plans for expansion and innovation are both ambitious and strategically planned. In Mexico, we aim to solidify our position as the leading heat treat provider by expanding our facilities and increasing our capacity. This includes investing in more hybrid furnaces that offer both electric and gas heating solutions, which are not only cost-effective but also environmentally friendly.

Data analytics on process costs can dramatically help save and optimize resources, yet few take the time to analyze this business data. While many analyze process data to comply with standards, staying competitive today means meeting quality specs efficiently. We focus on analyzing this data to maximize equipment output, extend furnace life, reduce downtime through proper maintenance, and decrease process times in commercial work to lower costs.

We also plan to enhance our data analysis capabilities. By integrating advanced data analytics into our processes, we can provide our customers with more precise and actionable insights, improving their operational efficiency and product quality.

The hybrid furnaces, in our opinion, are the only solution that makes sense for our market. They reduce emissions while maintaining competitive costs compared to the market and remain flexible to operate on full gas or full electricity.

Automation on production lines is also crucial. Labor is becoming more complex to train, and furnace work is demanding. Therefore, implementing cost-effective, low-entry automation from the start is essential nowadays.

In the broader NAFTA market, we see significant opportunities for growth. We are exploring partnerships and joint ventures that can help us tap into new markets and expand our service offerings. For instance, by collaborating with companies that have complementary technologies or market reach, we can offer more comprehensive solutions to our clients.

Furthermore, we are committed to sustainability. We are exploring renewable energy options and more efficient processes to reduce our carbon footprint and contribute to a greener industry. This not only helps the environment but also aligns with the growing demand for sustainable practices in the industrial sector.

By focusing on these areas, we are confident that we can continue to lead the heat treat industry and deliver exceptional value to our customers.

8) Carlos I very much appreciate your time and your candor-you have been very open about your goals and future plans. Our hope and trust are that our paths will continue to cross for many years. Thank you, Gord.

Carlos: I appreciate the opportunity and look forward to getting together with you in Mexico again-you are always welcome amigo.