Industrial real estate Mexico: manufacturing in Mexico begins to grow

The Governor of the State, Enrique Alfaro Ramírez, met with executives of transnational manufacturing companies with the aim of proposing scenarios that contribute to lessen the economic impact in this sector that, as a consequence of the coronavirus pandemic, could be generated in the event of a total stoppage of activities.



In Jalisco alone, this sector generates more than 600 thousand direct and indirect jobs and has a record of 396 companies operating in the National Council of the Maquiladora and Export Manufacturing Industry (INDEX), and the president referred to the need to generate a joint action proposal, so it was agreed to establish a working table between the State Government and company managers.


During the meeting held at Casa Jalisco, César Castro Rodríguez, national president of INDEX Occidente, stressed that this sector represents 11 percent of formal employment before the IMSS in Jalisco, 44 ​​percent of the transformation industry in Jalisco, represents 61 percent of state exports, and for this year, despite the pandemic, an investment of 142 million dollars is projected.

Government and manufacturers seek to lower economic impact by Covid 19.


                             

Jalisco's manufacturing sector generates more than 600 thousand jobs in the entity where there is a record of 396 companies affiliated to the National Council of the Maquiladora and Export Manufacturing Industry (INDEX), who held a meeting with the governor this Monday morning, Enrique Alfaro Ramírez to search for the common strategy to lessen the economic damages caused by the Covid 19. Alfaro Ramírez explained the measure of the Emergency Button as an instrument that would be applied in case the indicator of hospital occupation reaches 50 percent or is a weekly record of 400 infections per million inhabitants.

However, he said that at this time the level of hospitalization remains stable and the rate of infections remains within the established range. Through a statement, the State Government indicated that said meeting was with the objective of generating a proposal for joint action, so it was agreed to establish a working table with the managers of IBM, Sanmina, Continental, Flex, Foxconn, Latam, Jabil, Plexus, ZF, as well as the INDEX, INDEX DE OCCIDENTE, CANIETI and CADELEC. During the meeting held at Casa Jalisco, César Castro Rodríguez, national president of INDEX Occidente, stressed that this sector represents 11 percent of formal employment before the IMSS in Jalisco, 44 ​​percent of the transformation industry in Jalisco, represents 61 percent of state exports, and this year, despite the pandemic, an investment of 142 million dollars is projected.

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Mexico Manufacturing Today: Re-Opening of Essential Activities

Despite quarantine and stay-at-home measures still in place in Mexico and across the globe aimed at containing the spread of the coronavirus pandemic, plans are being carried out to gradually reopen several key areas of industry in accordance with strict protocols, with a priority placed on activities deemed as essential. Though governments across the world have varying definitions of what is considered as “essential,” as well as different restrictions on commerce, and a wide range of requirements in place in the face of constantly-changing health situations, they are all developing and implementing new strategies to resume economic activities in phases, and with this, begin to mitigate the effects of the pandemic on industry, national and international economies, and global supply chains.  

 In Mexico, with increasing concern regarding the impacts of the executive order in effect since March 24 shutting down all non-essential activities on international companies in Mexico, as well as its business partners in the US and across the globe, especially the automotive industry Mexico, the government has recently decided to expand its definition of essential activities to include the automotive, construction and mining sectors. This means that as of May 18, these businesses are allowed to partially reopen to begin developing and implementing safety and health measures that will allow them to fully reopen as of June 1. It is important to keep in mind that this information, and all changes to the definition of essential service and any industry-specific restrictions, depends on both the health situation in each area of Mexico, as well as market and supply chain demands, and as such, are subject to change at any time.

 Prior to this, and similar to the US, Canada, and other countries, only activities and services related to the operations of infrastructure (tollway operation and road maintenance), transportation services (air, rail, maritime, port and federal road transportation), communication, courier and post services, healthcare and paramedic services, supermarkets convenience stores, gas stations, hardware stores, construction (in some areas only for critical projects), and logistics and government social programs, were deemed as essential, and therefore allowed to continue operating. All other companies were required to either allow their employees to work remotely when possible, or place them on paid leave until restrictions are lifted.

Automotive manufacturing Mexico: Quebec's largest trading partner in LATAM, says minister

During her visit to the country between March 12 and 15 of this year, Quebec's Minister of International Relations, Nadine Girault, met with federal government political representatives, including Foreign Secretary Marcelo Ebrard, to define areas of cooperation between the two countries for the next two years, as well as to strengthen the diplomatic relationship of years with the Mexican government.

And it is that only in 2017, Quebec's exports to Mexico manufacturing  amounted to 1,755 million dollars, which makes Mexico the third largest international client in the French-speaking territory and its largest commercial partner in Latin America, according to data shared by the Girault team, recently elected in October 2018.

Currently, the Canadian province and Mexico are subject to 19 international agreements that involve the education, culture and art sector, the care of the environment, commerce, science and technology and for the new government to which Girault belongs, the Mexican and Canadian economies they complement each other and must continue to work together to boost the aerospace, creative and automotive industries.

To date there are 700 companies originating in Quebec that have started business with Mexico and 70 other large companies, also Québec, including Trans-Pro Logistics, Exo-S and Bombardier, installed in the country, which have invested around 6 billion dollars in Mexico, according to figures shared by Minister Girault.

He also took the opportunity to ensure that one of the objectives of his government is to encourage SMEs, both from Quebec and Mexicans, to export more products and in greater quantities, “because large organizations already know how to do it, they have the money, the size , seniority, contacts and support from its investors, ”said Girault.

"The Mexican people are so enthusiastic and eager to do business," said the minister and said that although "it is still too early" to give investment estimates and how many businesses will arrive in Mexico, said our country is and will be part of the five most important priorities for Quebec, and vice versa. ”

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The Aerospace Manufacturing Mexico and the take-off of productivity.

The aerospace manufacturing Mexico has also discovered the advantages that Mexico has in today's global manufacturing landscape: a convenient geographical position, numerous free trade agreements, a promising demographic bonus and a highly skilled workforce. In this text the opportunities and challenges that this sector has in our country are broken down.

Mexico has managed to consolidate itself as one of the main manufacturing centers in the Western Hemisphere thanks to a series of comparative advantages with which it has as its privileged geographical position, an open economy with an important network of trade agreements, a large population composed mostly of young people of working age, a competitive and skilled workforce, abundant energy and natural resources, as well as a worldwide recognized macroeconomic stability.

Thanks to this, in 2014 our manufacturing exports reached 337 thousand 289 million dollars and represented 85% of the total exports of that year. In this sense, our country exports 65% more manufactures than all of Latin America together and participates in several sophisticated sectors such as automotive and electronics. In addition, Mexico is a growing player worldwide in the aerospace sector.

Currently, the global aerospace industry is going through one of its best moments, which constitutes one of the most relevant opportunities for Mexico in order to increase the national content of its exports and thereby generate the quality jobs that thousands of Mexicans require .

Read :Start up manufacturing services in Mexico: Mexico could become manufacturing power in 2020

Global overview of the aerospace sector

Globally, one of the most dynamic and fastest growing industries is aerospace. According to the International Air Transport Association, in 2016 there will be around 3,600 million plane trips in the world, about 800 million more than those registered in 2011. According to this Association, between 2012 and 2016, the Passenger traffic on flights will grow on average 5.3% per year. On the other hand, the international cargo service will grow on average 3% per year to reach 34.5 million tons in 2016, 4.8 million tons more than in 2011.

By 2032 it is predicted that the fleet of aircraft, both passenger and cargo with a capacity of ten tons, will be 36,556 aircraft, which implies a significant increase if it is considered that there are currently about 18 thousand ships in commercial service.

Single-aisle passenger aircraft, commonly used by low-cost airlines, represent the largest segment of new orders and in the next 20 years are expected

20,240 deliveries of this type of aircraft. For the same period, it is projected that the demand for double-aisle aircraft will amount to 6,780 new orders, while those for cargo will increase to 500.

Mexico exports 65% more manufactures than all of Latin America together and participates in several sophisticated sectors such as automotive and electronics

Also, the companies producing the sector seek to reduce fuel consumption in new aircraft, in order to meet the demands of operators, which must lower their costs in the face of growing competition between airlines.

Within this context, Mexico is positioning itself globally as an important player for the main aerospace companies that must increase their competitiveness. This sector represents one of the main opportunities that our country has to take advantage of its comparative advantages and its important industrial development in order to increase the national content of our exports, generate more and better jobs, and increase the country's level of productivity.

Aerospace sector in Mexico

Currently, in Mexico there are more than 300 companies in the aerospace sector. Of these 80% are manufacturing, while 20% offer design and engineering services, as well as maintenance, repair and operations (MRO).

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Start up manufacturing services in Mexico: Mexico could become manufacturing power in 2020

Start up manufacturing services in Mexico is the eighth country with the largest manufacturing industry in the world and will be, at the request of Chancellor Angela Merkel, the guest country in the 2018 edition of the Hannover Fair, in Germany, considered the largest industry and manufacturing event of the orb More than 100 Mexican companies will be representing the country at the meeting, in which 5.6 million global business contracts are created each year.

The country is facing the opportunity to become a manufacturing power if it manages to rise from today to the trend of Industry 4.0, a term coined precisely by the organizers of this meeting on German soil, in which technology is the axis to strengthen capacity of manufacturing of the companies, considers Marc Siemering, who is vice president of Industry, Energy and Logistics of the German company Deutsche Messe.

We recommend you read: Mexico manufacturing: Ford and Volkswagen, allies in the electric car business

Mexico is the fourth country in the world that most imports industrial robots, according to the World Trade Organization (WTO), but, nevertheless, in the field of cobots (collaborative robots, capable of interacting with human beings in the conference labor), the country is just taking its first steps.

"This industrial transformation that we are experiencing will lead workers to modify their job roles, so they must be prepared to perform in a digitized environment that will be more intense," says the Deutsche Messe director.

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