By Adina Moloman

The major Industries Manufacturing in Mexico have strengthen their position as key players in the global automotive supply chain based on their competitiveness as a manufacturing platform and now are positioning as one of the main runways for the international aerospace industry, since many multinational aerospace corporations established in Mexico in the last ten years.

According to the National Strategic Program of the Aerospace Industry in Mexico one of the strategy for the aerospace sector is the development of local suppliers and encourage the aerospace cluster development in key regions. Based on this, FEMIA (The Mexican Federation for the Aerospace Industry) with the support of Mexican Government and ProMexico helped released a project by the Mexico-E.U. Competitiveness and Innovation Program (PROCEI), where they helped migrate local suppliers from the automotive and auto parts sector to aerospace sector by authorizing an AS9100 certifications to a small group of local Mexican companies.

The AS9100 Aerospace Management Systems is a widely adopted and standardized quality management system for the aerospace industry based on the ISO 9001 quality system requirements.

The institutions mentioned above allocated a budget of US$2.8 million to complete this task. They identified a number of 50 local suppliers but only 20 local Mexican companies entered the program. A number of 18 out of 20 local suppliers achieved the AS9100C certification last year.

By becoming registered to AS9100 the local suppliers can gain a competitive advantage since encompasses all the requirements for quality and safety relevant to aerospace sector and basically is a condition required by all major aerospace manufacturers (OEMs) for doing business with them.

Is important to understand that during the process of certification the local suppliers learned also how to transform the cost structure of their operations, maximizing their own resources while improving their bottom line.

By Adina Moloman

Source: Transactional Track Record

Foreign direct investment (FDI) inflows grow year-over-year to millions of dollars in Mexico and at the same time there is also a positive trend regarding the Mexican M&A (mergers and acquisitions) market. The transnationals’ US-based companies were the most acquisitive in Mexico last year, followed by transnational corporations from UK, Brazil, France and Switzerland. For instance there are several important deals in the high end market (>500) where Switzerland-based Partners Group acquired a majority stake in Mexican oil company Fermaca, for USD 750m; the US-based PPG Industries acquired the Mexico Corporation Consorcio Comex, for USD 2,300m.

In 2014, the Mexican transactional market closed with a total of 230 mergers and acquisitions, generating an investment volume of USD 30.10bn.

It seems that North America remains also the top region for the Mexican investors for a second year, with three acquisitions registered in the high-end market (>500m); two in the United States and one in Canada. One of the deals in the high-end market was the acquisition of Canada Bread made by Mexican company Grupo Bimbo, for USD 1.66bn.

Mexican corporations showed last year a much more interest in the European market, especially in Spain and Austria. Mexico-based Inmobiliaria Carso acquired a stake in América Móvil, for USD 5.90bn. We can mention also that Mexican telecommunications company America Movil has secured a majority stake (59.7%) in Austria Telekom. Mexico Corporation America Movil is considering making an offer to buy all of the European carrier’s outstanding shares with the idea of expanding much more in Europe.

The Mexican entity Mexichem that manufacturing in Mexico high-end specialty products acquired Dura-Line, a portfolio company of CHS Capital, a Chicago-based private equity firm.  Dura-Line is a global leader in high-density polyethylene (HDPE) conduit, duct and pressure-pipe solutions for telecom and data communications, energy and infrastructure industries that has manufacturing facilities in the U.S., Mexico, India, Oman, Europe, and South Africa.

In spite of the fact that Mexican corporations decide to orient themselves on new markets in Europe and North America, they continue to have their major presence in Latin America. Ecuador for instance is a constant destination for Mexican investors.

By Adina Moloman

Source: http://pacdesignshow.designnews.com

The 14^th annual edition of Pacific Design & Manufacturing show featured successful manufacturing and business leaders from the pacific zone especially from California and also from Baja California and delivered exceptional manufacturing projects in order to drive plant production forward.

Manufacturing professionals came together to network with peers and hear from an impressive lineup of speakers, focused on innovative solutions from a wide range of specialties including 3D Printing, Automatic Gaging Equipment, CAD/CAM/CAE Software, CMMs and DMMs, Contract Manufacturing, Electro-Optics, Laser Machine Services, Metals & Alloys, Rapid Prototyping, Packaging Equipment, Precision Metrology, Plastics & Elastomers; QA/QC, Sensing, & Inspection Systems, Rapid Prototyping and EBM; R&D Testing Equipment and Services etc., in order to offer solutions to all manufacturers who seek increased productivity and lower cost.

The meeting took place last February, at the Anaheim Convention Center, Anaheim, CA.

The show had an array of new and emerging technologies that will continue to revolutionize the manufacturing world where the participants received information on top-level developments in industry from almost 300 exhibitors in one to three days of conference sessions.

Over 150 speakers from renewed companies came with presentation with topics such as: The Internet of Things for Manufacturing, Latest Developments in 3D Printing, Design Innovation in Action, Integrated Packaging Optimization, Integrated Quality Management. Some of the speakers at the event were Babak Parviz, Ph.D., Vice President, AMAZON, Former GOOGLE Director; Kyle Locke, Director of Design, GOOGLE, Keynote on Innovation in Design, Paul Brody, Vice President, IBM, The Internet of Things: Going Beyond M2M among many others.

This event was designed for senior manufacturing Directors with a nearshore experience in Sector Manufacturing in Mexico and US counterparts to convene, network, learn, debate and to share best practices in a highly stimulating environment.

By Adina Moloman

Sources: Manufactura, World Economic Outlook Database, Inter-American Development Bank’s Trade and Integration Monitor 2014

Mexico is an export-orientated country, among the 15th largest exporter in the world. To strengthen Mexico’s economy, support jobs, and ensure long-term, sustainable growth, the government have been working on a wide strategy to promote exports. In 2014, Mexico’s main exports were manufactured goods (84 percent of total export revenues) and oil and oil products (14 percent).

According to a study conducted by the American Development Bank (BID), the Mexican exports recorded the largest USD growth from all Latin America countries in 2014, reaching US$397 billion in exports. Mexico’s exports has grown steadily; rising 7% percent from $349.6 billion in 2012 to $370.9 billion in 2013 and again another rise of 5% percent in 2014.

The regional export for Latin America is going through stagnation; only Mexico’s exports have risen significantly. According to the Inter-American Development Bank’s Trade and Integration Monitor 2014 Central America posted moderate growth (less than 2%) while exports from the Andean countries and MERCOSUR fell slightly (–1.8 percent and –1.0 percent, respectively), and those of the Caribbean declined substantially (–4,2 percent).

So, exports are boosting the Sector Manufacturing in Mexico. The Mexican automotive industry has continued to be a strong area of growth for Mexican exports. Automotive vehicle and parts exports were up by more than 10 percent in 2014, compared to 2013 and now account for around 27 percent of total exports revenues. Most Mexican exports are manufactured goods and more than 80 percent of the country’s total exports are sent to the United States. In fact the 2014 growth in exports was driven by a 6.0% increase in sales to USA market. Another important trade partners in 2014 were Canada, Korea and Germany.

By Adina Moloman

The electronic cluster in Tijuana is one of the largest in Mexico, employs around 90,000 direct workers in 120 transnational companies most of them from Japan, Korea and Taiwan specializing in consumer and specialty electronics. Transnational companies nearshoring in Mexico such as Samsung, Foxconn, Panasonic, Sanyo, Plantronics, Sharp, TPV and other large electronics manufacturers have a lot of experience manufacturing in Tijuana.

The Tijuana Manufacturing electronic industry specializes in manufacturing electronic products, mainly consumer electronics—televisions (LCD, DPL, Plasma), mobile phones, computer devices, circuit boards, audio/video components, microchips, semiconductors and many more.

In 2014, Tijuana had a significant global share in television exports (more than 20 million high tech televisions manufactured in this city). Mexico has become the world’s leading exporter of flat screens, surpassing most Asian countries.

TPV Taiwan one of the largest television and screen manufacturers announced in 2014 the expansion of its plant in Tijuana. The company plans to invest $10.5 million in the expansion and add 500 new jobs in 2015.

In 2014, Samsung electronics added production capacity to its plant in Tijuana.

Since 1988 when Samsung Electronics completed construction of an electronic complex (SAMEX) in Tijuana to manufacture TVs, color monitors, and mobile phones, constant upgrades in technology and production volume leaded to also a constant investment to the Tijuana Samsung facility.

Sharp Corporation also added production capacity to its manufacturing facility in Tijuana in 2014.

Tijuana has gained the position as the leading destination for high-value-added operations in the electronic sector manufacturing in Mexico.

By Adina Moloman

Sources: Oxford Business Group, PWC

In the last ten years, Mexico has had several experiences involving the private sector in the development and management of different infrastructure projects in diverse sectors, including transport, communications, and environment and has proved to be an important source of innovation in those sectors highly benefiting the industries manufacturing in Mexico. In terms of risk transfer and depth of private sector involvement, however, the experience of Mexico remains relatively limited since the foreign and local private investors participation is reduced to punctual contracts, depending on the infrastructure projects.

In order to transfer more responsibilities and also a higher transfer of risks to the private sector the Mexican Government is working on creating a proper regulatory framework known as the Public-Private Associations Law that was approved by the lower house of Congress in 2011 and by the Senate in October 2010. According to this law the government is entering into infrastructure and service provision contracts with the private sector for up to 40 years and is expecting to bring deeper efficiency gains.

At state level there is a new law, known as the Law on Public-Private Partnership, which for instance was approved by the Congress of the State of Baja California in September 2014.

There is aggressive competition between Mexican states to attract local investments; since they don’t have the opportunity to offer tax incentives, local governments create development programs in order to attract FDI, such as price employee training programs, reductions of the state payroll tax, real estate, land transfer, etc. A better way to attract investment in the state is by building infrastructure in many fields as possible.

Baja California is one of the most competitive states regarding the attractions of a variety of industries related to Mexico Manufacturing sector. From now on based on the new Law on Public-Private Partnership in Baja California there are considered around 120 infrastructure projects in partnership with the private sector in many different sectors such as transport, water treatment, storm and wastewater management, energy, etc.

Baja California with and annual budget of $ 466 million is now counting with a proper regulatory framework to work together with private investors in order to develop infrastructure projects