Manufacturing In Mexico
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Everything you need to succeed.
Why manufacture in Mexico?
Manufacturing in Mexico is becoming more popular than ever. It is not just an option now but a necessity to remain competitive. The current macroeconomic environment is driving companies away from China and into Mexico through a phenomenon known as “nearshoring. ” This relocation of supply chains began with Covid-19 and was accelerated by the tensions between East and West.
The answer to why manufacture in Mexico is straightforward. With business becoming more complex in China, manufacturing in Mexico is a natural choice. Mexico has proximity to the United States, coupled with a 3,000 km (1,865 miles) border, makes it the best choice for relocating factories. This is the reason why the Mexican government issued the IMMEX program in 2006, to let maquiladoras in Mexico import raw materials free of duties and VAT.
What Makes Manufacturing in Mexico So attractive?
Geographic Position
Mexico is strategically positioned to serve the U.S. Market, Canada and Latin America.
Manufacturing in Mexico will give you an unbeatable advantage in selling to the American market. The country’s proximity to the US and wide border makes supply chain logistics a breeze. By some estimates, the shipping times are up to 80% less when compared to China.
Whatever you are looking to transport, all you need is trailer trucks. And if you choose one of the many bordering cities to manufacture in Mexico, you could be a couple of hours away from your distribution center.
Logistics Savings
North American companies manufacturing in Mexico have a supply chain that it is much shorter than it would be from other continents such as Asia. From Mexico, shipments are delivered by cargo truck.
Same Time Zone
Forget jet lag. When manufacturing in Mexico, the time zone is the same. The worst case scenario would be a couple of hours difference.
Faster & Cheaper Visits
If you need to visit your facilities you don’t have to pay thousands of dollars in airplane tickets. You can be back home in a day or two.
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Manufacturing in Mexico: Supply Chain & Logistics
Highly Skilled Workforce
When manufacturing in Mexico, you get access to the a highly skilled workforce. With high technology training centers, Mexico's workforce is highly skilled and abundant. Mexico has been a manufacturing spot for international companies for decades and has shifted from basic manufacturing and assembly to more complex products.
Mexico is now the 3rd-largest exporter in the IT industry, 6th-largest supplier to the American aerospace industry, and the leading supplier of medical devices to the U.S.
Mexico has over 2,500 higher education institutions offering well-ranked and highly-sought after education and training programs. Over 110,000 engineers graduate in Mexico each year.
The Government incentivizes specialized training programs to qualify people to work in the advanced, technical industries.
Free Trade Agreements: Manufacturing in Mexico's Competitive Edge
Mexico has Free Trade Agreements with 46 countries which will give your products preferential tariffs.
Mexico’s Free Trade Agreements have pushed the country to become the 13th-largest export economy in the world. When manufacturing in Mexico, you get access to trade agreements in three continents, Mexico is positioned as a gateway to a potential market of over one billion consumers and 60% of world´s GDP. Certain treaties avoid double taxation between Mexico and other countries including the U.S., Germany, Canada, Sweden, France, Japan, Brazil, China, United Kingdom, Italy and more.
The North American Free Trade Agreement. Between the US, Canada and Mexico it eliminates tariffs on goods with a 60% rule of origin.
Investors in either region are granted preferential access to goods and services, and investment security.
Japan has become Mexico’s 5th largest export destination. Known as an Economic Partnership Agreement (EPA) it provides relieved tariffs on goods and services.
Guatemala, Costa Rica, Honduras, El Salvador, and Nicaragua signed an agreement with Mexico. The agreement includes little to no tariffs on goods and services.
Intellectual property rights are are an importan advantage when manufacturing in Mexico. IP rights are well stipulated and enhanced by international agreements that provide a solid protection to your company’s intangible assets. Mexican government agencies overlook intellectual property rights protection based on the Industrial Property Law, the Federal Copyright Law and the International Agreements to which Mexico belongs.
Protection of intellectual property in Mexico improved when the country became a party to the North American Free Trade Agreement.
WIPO is the global forum for intellectual property services, policy, information and cooperation. Mexico is a part of WIPO since 1975.
The Paris Convention for the Protection of Industrial Property was one of the first intellectual property treaties.