GENERAL SITUATION IN MEXICO
Weekly Review I July 10, 2024
RELEVANT NEWS INDUSTRIES
EV:
General Motors Mexico has partnered with Tesla to deploy 1,000 charging points across Mexico as part of their strategy to bolster electric vehicle (EV) adoption. They are also planning government incentives to encourage EV purchases. CEO Francisco Garza highlighted GM’s commitment to leading the EV market, with plans to introduce several new electric models in Mexico, including the Cadillac Lyriq and Chevrolet Blazer. They aim to expand their charging infrastructure significantly, including home and dealership installations. Collaborations with Tesla and Ford will standardize charging standards, enhancing compatibility across networks by 2025. GM’s ongoing investments underscore their dedication to EV production, evident in record-breaking deliveries and strong sales growth in the EV sector.
SOURCE: MEXICO BUSINESS NEWS
AUTOMOTIVE:
The automotive industry in Mexico in 2024 shows resilience and growth. According to the International Organization of Motor Vehicle Manufacturers (OICA), Mexico remains a key global producer with a slight year-overyear production increase. In 2023, global motor vehicle assembly reached 93,546,599 units, with Mexico producing 4 million units, a 14% rise from the previous year. Despite a lower-than-expected demand of 115,754 light vehicles in January 2024, the sector remains robust. Mexico ranks highly in global automotive metrics: 1st as exporter of heavy trucks. 1st as supplier of autoparts to the USA. 1st in generating Foreign Direct Investment (FDI) in Mexico. 4th as exporter of light vehicles, cargo, and passenger vehicles. 4th as producer of cargo vehicles. 4th as producer of autoparts worldwide. 7th as producer of light vehicles. The industry contributes significantly to Mexico’s GDP, with major production hubs including the North, Central, and Bajio regions.
SOURCE: LIDER EMPRESARIAL
RELEVANT NEWS INDUSTRIES
AEROSPACE
According to data provided by the Mexican Federation of the Aerospace Industry (FEMIA), Mexico is home to 386 aerospace manufacturing companies spread across 19 states. Baja California, Nuevo Leon, Sonora, Queretaro, and Chihuahua are the main production hubs, accounting for up to 90% of industrial activity in this sector. However, the aerospace industry also extends its presence to other states such as Coahuila, San Luis Potosi, Hidalgo, Yucatan, Durango, Zacatecas, Mexico City, Aguascalientes, Jalisco, Guanajuato, State of Mexico, Puebla, and Oaxaca. 2024 is expected to be a historic year for the aerospace industry in Mexico, projecting exports of $10 billion, representing a growth of over 15% compared to last year.
SOURCE: MEXICO INDUSTRY
RELEVANT NEWS BUSINESS
CHAMBERS
INDEX ZONA COSTA, BAJA CALIFORNIA
Index Zona Costa B.C. is organizing an event on July 25th in Baja California aimed at bolstering local supply chains across various industries including plastics, aerospace, metalworking, logistics, electronics, automotive, and more. The event seeks to facilitate new business connections and economic development by engaging small and medium-sized suppliers in the region, focusing on manufacturing processes. They emphasize the importance of certifications like ISO standards to enhance international competitiveness. Overall, the event aims to strengthen regional economic growth and industry competitiveness.
SOURCE: MEXICO INDUSTRY
CLAUGTO
The Automotive Cluster of Guanajuato (CLAUGTO) and the Italian German Exhibition Company Mexico signed a collaborative agreement to advance future mobility in Mexico’s Bajio region. This partnership aims to enhance the automotive industry’s value chain and promote economic and technological growth in the area. Key figures from both organizations participated in the signing ceremony.
SOURCE: MEXICO INDUSTRY
NEWS BY STATE
SONORA
Thirty young people from Sonora are embarking on a significant opportunity to study at universities in Taiwan as part of a collaboration with local higher education institutions. Selected for their technical skills, English proficiency, and academic achievements, they will focus on areas such as electromobility, automation, and semiconductors. This initiative, supported by the Sonora Plan for Sustainable Energies, aims to cultivate talent that can contribute to advancing these industries within the state.
SOURCE: EL IMPARCIAL
BAJA CALIFORNIA
Gabriel Camarena, leader of the Binational Axis of the Tijuana Development Council (CDT), highlighted significant economic growth in Tijuana and San Diego across various sectors like manufacturing, tourism, commerce, and housing. Key points include the robust export and international trade activities, with Otay Commercial Customs surpassing one million truck crossings in 2023. The combined GDP of San Diego and Tijuana exceeds $40 billion, driven by industries such as electronics, medical devices, and automotive parts. Tijuana’s manufacturing sector accounts for nearly 50% of formal employment, demonstrating its economic importance within Baja California. Challenges include infrastructure and regulatory improvements to sustain growth, with Camarena emphasizing the city’s potential tied to its binational relationship and opportunities arising from the nearshoring trend.
SOURCE: INDUSTRIAL NEWS BC
NEWS BY STATE
NUEVO LEON
In Nuevo Leon, companies integrated into the supply chains of major tractor manufacturers have successfully substituted imports valued at over 1,700 million pesos. The State Ministry of Economy implemented the Import Substitution Program, investing 53 million pesos to support local firms, resulting in the creation of 700 new direct jobs. The program focuses on enabling associations, business chambers, and clusters to propose projects that enhance local SME participation. Additionally, a collaboration with the Household Appliances Cluster and Ternium facilitated training for 20 companies, enabling them to supply components worth 50 million pesos and generate 236 direct jobs, particularly in manufacturing metal components, industrial machinery, and other critical products.
SOURCE: EL ECONOMISTA
NEWS BY STATE
SAN LUIS POTOSI
Governor Ricardo Gallardo Cardona of San Luis Potosi confirmed that Yutong, a prominent Chinese bus manufacturer and provider of the MetroRed transportation system in the state, is considering a $400 million investment to establish an assembly plant there. This potential project aims to serve both the domestic and South American markets, promising significant economic benefits including job creation and bolstering local industrial infrastructure. Gallardo expressed confidence in the state’s economic potential and noted the upcoming discussions with Yutong executives to finalize project details.
SOURCE: MEXICO INDUSTRY
NEWS BY STATE
GUANAJUATO
At the DIVEX business meeting in Leon, Guanajuato, organized by APIMEX, a panel discussed business diversification strategies. Speakers from Pirelli, SAFRAN Chihuahua, Blender, and Guanajuato Puerto Interior highlighted the importance of high operational standards, cultural compatibility, technology adoption, and robust quality management for successful diversification. They emphasized the need for innovative thinking, strategic timing, and supportive partnerships to navigate challenges and achieve growth in competitive markets like aerospace and construction.
SOURCE: MEXICO INDUSTRY
QUERETARO
The automotive industry in Queretaro is evolving with a focus on integrating automotive system development alongside traditional auto parts manufacturing. Daniel Hernandez Camacho, director of the Automotive Cluster of Queretaro, notes this evolution includes new investments and expansions by companies enhancing their technological capabilities. There is a noticeable trend towards plants prioritizing comprehensive automotive systems over individual components, driven by industry demand for advanced technologies like intelligent vehicle lighting systems that can communicate and adapt.
SOURCE: EL ECONOMISTA
NEWS BY STATE
CDMX
At the end of 2023, Mexico achieved a record in Foreign Direct Investment (FDI) with over USD 36 billion, with Mexico City (CDMX) receiving 31% of this amount ( USD 11.197 billion). Fadlala Akabani, head of SEDECO, highlighted the advantages CDMX offers to foreign companies, such as skilled labor, widespread English proficiency, and the presence of major IT companies like SAP, Siemens, and Honeywell. The government’s strategy to attract more FDI includes economic sector clustering, exemplified by the Metropolitan Automotive Cluster, which improves networking and services in the automotive sector. Additional clusters are being developed in audiovisual, IT, aerospace, and health sectors. Mexico City is also strengthening international relations with countries like China, Malaysia, Singapore, and Taiwan, with notable investments in automotive, energy, and telecommunications sectors. These efforts position Mexico City as a key player in regional and international economic development.
SOURCE: MEXICO INDUSTRY
STATE OF MEXICO
Event industry entrepreneurs in the southern region of the State of Mexico have reported that organized crime is affecting their operations and other sectors. Carlos Pliego, president of the State of Mexico Event Business Association (AEEM), highlighted the need for protection due to criminal activities such as robberies and kidnappings, which are hindering economic growth. He emphasized that insecurity has complicated business operations and deterred providers from taking job opportunities. To address this, he called for all social actors, including authorities, to collaborate in restoring the rule of law. Security Secretary Cristobal Castañeda stated that they would secure the Tierra Caliente region to combat organized crime and noted that the business sector could request preventive support from the SSEM before events.
SOURCE: EL SOL DE TOLUCA
INVESTMENT NEWS
CENTRAL MEXICO
MINTH
With an investment of 57 million dollars, MINTH announced a new expansion of its operations in Aguascalientes. This adds to its previous investment of 173.5 million dollars in March 2024, aiming to create up to 1,600 jobs.
VAZLO
The automotive supplier, Grupo VAZLO, announced its arrival in Aguascalientes with an investment of 42.5 million dollars, generating 225 jobs in the first stage.
GETTEL
The Chinese manufacturer of plastics, will invest 80 million dollars in Jalisco. It will begin operations in March 2025 and, in a subsequent phase after the start-up, will create up to 400 jobs.
NORTH
DANFOSS
Danfoss will expand its facilities in Apodaca, Nuevo León. In the new facilities that will be created and will begin operations in the first quarter of 2025, sensors will be produced. The new expansion is expected to create 400 jobs.
HOFUSAN
The Chinese company dedicated to industrial parks announced the construction of residential complexes in Salinas Victoria with an investment of 80 million dollars.
SOURCES: MEXICO INDUSTRY, CLUSTER INDUSTRIAL, EL ECONOMISTA, GOVERNMENT OF NUEVO LEON
LEGISLATIVE CHANGES AND INITIATIVES
LABOR
• INITIATIVE WITH DRAFT DECREE TO ADD A SECOND PARAGRAPH TO SECTION XXIX OF PART A; AND TO ADD A SUBSECTION G) TO SECTION XI OF PART B, BOTH OF ARTICLE 123 OF THE POLITICAL CONSTITUTION OF THE UNITED MEXICAN STATES
Presented by: Sen. Cecilia Margarita Sanchez Garcia (Camp - PRI) (See profile)
Purpose: To establish that social security benefits will be granted by all companies to their workers in proportion to the time they work, regardless of the employment contract regime or any possible contrary provision in the Collective Bargaining Agreement.
Status: 2024-07-03 - Published in the Parliamentary Gazette.
ENVIRONMENT
• TAMAULIPAS: INITIATIVE TO ADD SECTIONS XXXV TO ARTICLE 2, AND XXIII, SHIFTING ARTICLE 5, OF THE CLIMATE CHANGE LAW FOR THE STATE
Presented by: Loc. Rep. Juan Vital Roman Martinez (Tamps - MORENA)
Purpose: To define Green Jobs as decent positions that contribute to the conservation, restoration, and improvement of environmental quality in any economic sector. This includes reducing the environmental impact of businesses and economic sectors, lowering greenhouse gas emissions, minimizing and eliminating any form of waste and pollution, and restoring ecosystems and biodiversity.
Status: 2024-07-02 - Initiative referred to the Commission for ruling.
PRODENSA INSIGHTS
Explore our latest blogs and stay updated with valuable insights! Visit our website today: www.prodensa.com
https://www.prodensa.com/insights/blog/shelter-services-and-other-types-of-immex-in-mexico
The blog discusses Mexico’s IMMEX program, enabling foreign manufacturers to import goods temporarily without VAT if used for export production. It outlines various IMMEX types: Industrial, Holding, Services, Shelter, and Third-Party. Choosing the right type depends on business needs, company structure, and administrative capacity.
For more details, visit the blog post.
SHELTER SERVICES AND OTHER TYPES OF IMMEX IN MEXICO: