At present, Mexico is the 4th largest exporter and 7th largest vehicle manufacturer in the world. Since, 2013, over $23.3 billion in new investments in the sector have been announced in Mexico. Aside from competitive labor costs, Mexico’s 44 trade deals with countries across the globe can save automakers up to 10% per vehicle with shipping.
Leading the nation in research and development initiatives, Nuevo Leon and Coahuila showcase that Mexico is no longer purely a manufacturing destination. Harboring the oldest and most established cluster in the country, the northeast region’s many strategic advantages have attracted OEMs and Tier 1s alike to build facilities within the states—Freightliner, Chrysler and the new Kia plant to name a few. Through its collaboration between academic institutions, government and industry, the region has quickly evolved to include complex components and value added processes as a baseline of offerings.
Mexico houses around 120 Tier 1 companies and over 600 manufacturing plants, yet only about a dozen of these companies are Mexican owned. Impressively, eight of those are situated in the Nuevo León/Coahuila region. Locally owned entities are more likely to develop the supply chain, which is why this region serves as an important case study for overcoming the ‘inverted pyramid’ challenge facing the entire country.