Automotive Manufacturing in Mexico
Automotive Beginnings in Mexico
In 1910, Daimler and Renault were the first companies to establish assembly operations in Mexico, but that was short lived due to the Mexican Revolution which took place the same year. In 1921, Buick began assembling its automobiles in Mexico, followed by Ford Motor Company in 1925.
Investment in Mexican Automotive Manufacturing
Mexico is the primary exporter of automobiles to the U.S. the overall 4th largest exporter of automobiles in the world. Experts predict car and light truck production to grow to 4 million a year by 2020. Global automakers have invested $13.3 billion to manufacture in Mexico, and that's not including other North American countries.
OEMs and Supply Chains in the Mexican Automotive Industry
Currently, eight automotive OEM’s have a manufacturing presence in Mexico, with a combined 19 plants located in various parts of the country. Along with access to Mexico's 13 free trade agreements, the supply chain companies that operate in various locations to support automotive manufacturing are also benefits for OEMs.
Snapshot of the Mexican Automotive Industry:
|Chrysler||3||Engines, RAM, Promaster, Journey, Fiat 500|
|Ford||3||Fiesta, Fusion, MKZ, Hybrids, Engines, Foundry|
|GM||4||Cheyenne, Silverado, Sierra, Aveo, Trax, and others. Engines and transmissions|
|Nissan||3||Pickups, Frontier, Tsuru, Tiida, NV200, YorkTaxi, Versa, others|
|Volkswagen||2||Beetle, Classic, TDI, Jetta, Golf, High tech engines|
KIA and BMW have recently announced manufacturing facilities in the State of Nuevo Leon and San Luis Potosi
Areas of Mexico with the Highest concentration of Automobile Manufacturing:
- The area around the city of Saltillo (Saltillo, Ramos Arizpe, and Derramadero) with the presence of several plants owned by GM and Chrysler/Daimler/Fiat.
- A corridor in the State of Guanajuato consisting of the cities of Leon, Silao, Irapuato, Celaya, and Salamanca.
The long time presence and most recent growth of automotive manufacturing in Mexico is the result of the lowest labor cost structure in North America, OEM venue diversification strategies, and a rapidly growing skilled workforce.
Offshore Group Manufacturing Communities
Our Manufacturing Communities serve as an ideal venue for small and medium sized tier 2 and 3 suppliers because of the scalability of facilities and a shared-services business model that allows clients to take advantage of economies of scale from day one. Other advantages include a legal framework that allows foreign companies to operate for four years without needing to establish permanent operational status and being assessed income taxes based on their manufacturing activity in Mexico.