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The UK shows growing interest in Mexico

A picture of a graph is overlaid on a picture of stacks of Mexican pesos.
06 Feb 2014

Companies in the UK are being invited to a seminar to learn about trading with Mexico, according to the Manchester Evening News.

Mexico is one of the so called MINT countries, which economist Jim O'Neill cites as the four next growth markets. Speakers include Mario Gozalez with ProMexico, Yves Hayaux, chairman of the Mexican Chamber, and Paul Eadie, UKTI's specialist adviser on South America.

"According to KPMG, Mexico is 21 percent more cost competitive than the United States in manufacturing projects, and there is plenty of support for businesses wishing to make links there, both from UKTI's team in the north west and our many advisers in embassies and consulates in-market," said Eadie.

Offshoring advantages
Just last year, Roberto Ferdman of Business Insider wrote that Mexico was becoming the best place in the world for auto manufacturers. He cited the North American Free Trade Agreement (NAFTA), which eliminated tariffs on goods going between the U.S. and Mexico. In 2013, Mexico accounted for approximately 20 percent of North American light vehicle production, according to the article.

Although 63 percent of the cars that Mexico builds are shipped to the U.S.,  the rest are either sold in Mexico or go overseas. An estimated 45 percent of the cars being exported are made by companies that have headquarters in Asia and Europe.

Low cost manufacturing is the biggest advantage Mexico has over other countries in auto manufacturing, according to the source. Land and labor are "abundant and cheap," and plants run with "practically no limits." The article cited a Nissan plant that runs over 20 hours a day. Additionally, workers are becoming increasingly skilled.

Additionally, Mexico has experienced dramatic improvements in living standards and reductions in poverty, according to an article in The Financial Times.

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