Largest Mexican Contractor Leads the Way
January 15, 2007
MEXICO CITY - Carlos Armella Maza began his career building heating systems for residences in the rapidly growing capital city. In 1951, Armella and a partner founded Calefacciòn y Ventilaciòn S. A. (CYVSA®).
A walk through the precursor of modern-day CYVSA (pronounced seeb-sa) would have taken less than two minutes. Could he have imagined that a tour of the nation’s largest mechanical contractor today would take nearly an hour as one passes through a number of security points in the 160,000-square-foot facility that is corporate headquarters for a 1,700-employee company with 100 professional engineers on staff? Perhaps so, because not many years after its initial founding, CYVSA was already engaging in some of the country’s premier building construction projects.
Today, Alejandro and Sergio Armella Sanchez have taken over the reins of the company passed down from their father and have continued the amazing growth of CYVSA as a premier contracting company.
C, Y, and V are the first letters of the Spanish words for heating and ventilation, and S.A. is the Mexican business equivalent of Inc. in the United States. Therefore, the English translation of the company name is Heating and Ventilation Inc., but it has been known simply as CYVSA for decades.
FROM CENTRAL HEATING TO COMPLETE HVAC SERVICESCYVSA evolved from heating systems to manufacturing HVAC equipment to meet an ever-growing demand in the burgeoning city. At one point, York International approached the owners and offered to purchase all its manufacturing tooling in return for a product barter that covered the entire original expense of the tooling equipment. This opportunity provided York with a foothold in Mexico and CYVSA with product at a very good price for a number of years. This turning point allowed CYVSA to focus on what it is best known for today - design, construction, and service.
Not only does the company now have four branch locations in Mexico from which it services its customers, but also has remote locations in the Caribbean. At times, the company has placed branch operations in other parts of the world as construction requirements have dictated. The primary markets served today are Mexico, Nassau, Puerto Rico, Anguilla, and the Caribbean.
CYVSA performs approximately 1,000 construction projects every year and has more than 16,000 total jobs to its credit. Sergio Armella, company president, said that the company also turned the majority of those projects into service customers.
“Our company has seen from 18-22 percent annual growth for 30 years. The market has grown in Mexico,” said Armella. “We have to be on the competitive edge; we are always fighting for our position in the market.”
Armella said that the company’s strong advantage is due to the highly skilled workforce of CYVSA. Unlike many companies, CYVSA will take its locally trained crews around the Caribbean for projects, rather than hire and train local help.
“The quality of our people is second to none, and we have found it much more cost-effective as we tend to avoid callback and warranty problems that we have encountered trying to employ less-talented people in the past,” said Armella.
GROWTH AND ACCOMPLISHMENTSIronically, Calefacciòn y Ventilaciòn is no longer noted so much for its “Calefacciòn” work. Many years ago in downtown Mexico City, heating was in much greater demand. Today, however, cooling is the order of the day and certainly a predominant part of CYVSA’s work.
The city has grown tremendously in stature the last two decades and is now the fifth largest megalopolis on the planet. With its blended culture of native Indian and Spanish, it is considered one of the most popular tourist destinations in the world.
No doubt that such prominence and growth has contributed to the success at CYVSA. The company has earned 11 of the 17 annual national awards of the Intelligent Building Institute. Over the decades, CYVSA has pioneered the path for innovative projects and first uses of several technologies.
• The 1950s. Even in the earliest days CYVSA was known for maintaining an edge in the market. An early project was the presidential residence, home to the current president of Mexico; the first high-speed capillary evaporative cooling system at the Palacio de Hierro department store; and the first radial heating and ventilation system at the Mexico City International Airport.
• The 1960s. The company was entrusted with the National Border Program that entailed servicing national warehouses, offices, and hotels along the northern border. Projects of stature include the Sheraton Hotel 1 on Reforma Avenue, the U.S. Embassy Building, Ford Motor Co., and the Camino Real Hotel with state-of-the-art technologies, which became a model for other projects throughout the country.
• The 1970s and 1980s. Attention turned outwardly from central Mexico to the popular coastal areas. Resort hotels, condominiums, and convention centers in cities such as Cancun, Acapulco, and Ixtapa became common fare for CYVSA. Also, during this time period, the company built the Mexicana Airlines Tower and the new Congress Building.
In 1987, CYVSA founded Disenos y Proyectos (DYPRO), a company devoted to the design of HVAC systems. With more than 50 engineering professionals on staff, DYPRO designs more than 750 projects annually for CYVSA and other clients. About 70 percent of these are for CYVSA each year.
In that decade CYVSA truly emerged from being a traditional family-owned business to being a major market-oriented company focused on total customer satisfaction.
• The 1990s forward. The company founded Ductos y Formas (DUCTOFORM), a state-of-the-art sheet metal shop in 1993, to meet the heavy demands for duct fabrication for CYVSA customers. One such example was the 78 clean rooms for Schering Plough that required hermetically sealed ducts.
More major projects in the Caribbean and Latin America surfaced as the company continued its expansion. The Bahamas Atlantis Hotel project, phases I, II, and III has been one of the most well-known projects the company has worked on to date. A walk through CYVSA’s vast corporate office may take one past a wall with two live satellite feeds from the Atlantis jobsite. To say this project is handled with tender loving care is somewhat of an understatement.
CYVSA TODAYThe company’s growth during five decades has catapulted CYVSA to a status in Mexico and the Caribbean that is unmatched. Its expertise is varied, including pharmaceutical, hospitals and clinics, corporate offices, banking, entertainment centers, hotels, condominiums, retail, clean rooms, and even residential.
The company is grouped in business segments to rapidly respond to clients’ needs. Engineers specialize in a particular segment and coordinate with dedicated sales personnel and project estimators in the same segment. Until activity in a particular segment becomes large enough, it is managed in smaller work pods that may handle various duties. As activity in a pod grows, a dedicated business segment may be added to handle the requirements.
Approximately 60 jobs are “on the table” at any given moment, in various stages of design. An interesting facet of the company is that approximately 90 percent of sales are from repeat clients, even though a majority of the projects are of the plan-and-spec variety.
The company, once a manufacturing concern, hasn’t lost that capability. In order to meet the precision requirements of the banking industry, CYVSA assembles and sells its own mini-chillers, under the brand name Climaflex™. The mini-chiller is a DX conversion to chilled water in capacities up to 10 tons.
Armella said the reason for the product development was that “There wasn’t a suitable product available in the market that could meet the strict requirements for our banking industry customers. We knew what was needed and we designed it.”
That type of can-do attitude and customer concern has kept the $100 million company in the forefront of the Mexican and Caribbean markets for many years. When asked if CYVSA had eyes on the U.S. market, Armella smiled and said, “I have viewed the workmanship on American projects. I believe we could compete rather well; however, we have no great desire at this time, there is plenty of work in Mexico.”
SIDEBAR: LABOR FORCEAlejandro Perez Quintana is the director of marketing and sales for CYVSA. His career began outside of the HVAC industry; however, his marketing expertise has lent itself well to the rapidly expanding Mexican company. “The company began realizing its rapid growth under the guidance of both the brothers, Alejandro and Sergio Armella Sanchez. A few years ago, I had been performing marketing consulting work for CYVSA and they eventually asked if I would join the company. It has been one of the best career moves I have ever made,” said Quintana.
Quintana noted that one issue that plagues the U.S. construction market is currently the lack of skilled laborers. “In Mexico, there is no shortage of laborers. However, we are seeing that many of our most-skilled people will tend to migrate north to the United States in search of even higher wages.”
CYVSA has spent considerable energy to properly train its employees. It’s often been considered like a school for most of the HVAC workers in Mexico. CYVSA is well positioned as the premier commercial HVAC firm in the country.
Publication date: 01/15/2007