GENERAL SITUATION IN MEXICO
Weekly Review I September 25, 2024
RELEVANT NEWS INDUSTRIES
EV
Nuevo León has made significant strides in future mobility by unveiling its first 100% electric bus, manufactured locally. Governor Samuel Alejandro García Sepúlveda announced that this initiative marks a move toward modern transportation after 40 years of a deficient system. A total of 45 electric buses will operate on TransMetro routes, enhancing public transport with features such as Wi-Fi, surveillance cameras, wheelchair accessibility, and bike racks. The project aims to be completed within 20 months, before the World Cup, and is designed to improve connectivity within the city. Lucas Gabardo, General Director of Marcopolo Mexico, praised the high-quality manufacturing processes used for these innovative vehicles.
SOURCE: MEXICO INDUSTRY
AEROSPACE
Safran has announced plans to acquire Component Repair Technologies (CRT), a U.S. company specializing in aircraft engine part repairs, pending regulatory approvals. This acquisition aims to enhance Safran’s maintenance, repair, and overhaul (MRO) capabilities throughout the Americas. Based in Mentor, Ohio, CRT employs over 450 people and focuses on repairing key components for engines like the CFM56 and LEAP. Safran executives emphasized the strategic value of this acquisition for expanding their global MRO network and supporting the growing fleet of LEAP-powered aircraft. The integration of CRT will bolster innovative repair processes and is expected to be finalized by the end of 2024.
SOURCE: MEXICO BUSINESS NEWS
NEWS BY STATE
BAJA CALIFORNIA
Salvador Maese Barraza, president of INDEX Mexicali, anticipates an increase of 3 to 4 billion dollars annually in Foreign Direct Investment (FDI) with the upcoming Federal Government. This was confirmed by Vidal Llerenas, the new Undersecretary of Industry and Commerce, at the 49th National INDEX Convention. Efforts in Baja California aim to enhance local supply and strengthen value chains. Maese emphasized the need for collaboration between the private sector and government to attract nearshoring investments and improve support for Small and Medium Enterprises (SMEs). The “CEO Dialogue” will involve around 45 companies, fostering investment opportunities in Mexico.
SOURCE: LA VOZ DE LA FRONTERA
NEWS BY STATE
NUEVO LEON
During the inauguration of the Regio Real Estate Forum 2024, organized by the Mexican Association of Real Estate Professionals (AMPI) in Monterrey, Emilio Rojas Cobían, the national president of the organization, highlighted that nearshoring will lead Mexico to build approximately 100 million square meters of industrial space to meet demand. Currently, Mexico has over 80 million square meters of industrial space, equivalent to the size of Chicago and Dallas combined. There are 460 industrial parks in the country, with an additional 158 parks at various stages of development, significantly increasing rental space. However, a major challenge remains in meeting energy demand; without this, further growth will be impossible, emphasized Jorge Ávalos Carpinteyro, president of the Mexican Association of Industrial Parks (AMPIP) and CEO of Fibra Mty, during the panel “Building Tomorrow: Industrial Real Estate Development” at the forum.
SOURCE: EL ECONOMISTA
CHIHUAHUA
Chihuahua, with its robust automotive industry employing over 172,000 people, is poised to embrace a new wave of innovation: electromobility. This technological advancement aims to enhance the state’s competitiveness while creating specialized and sustainable job opportunities for workers and their families. At the recent Electromobility Forum, industry, academia, and government leaders collaborated to explore the potential of electric mobility for the region. Organized by the Chihuahua Automotive Cluster in partnership with the William Davidson Institute and the State’s Secretary of Innovation, the event emphasized the importance of strategic collaboration in positioning Chihuahua as a global leader in clean technologies. Renowned experts shared insights on how the state can lead the transition toward a sustainable and competitive future, highlighting electromobility as an opportunity for economic and social well-being. With a clear vision, Chihuahua is set to capitalize on the benefits of electromobility, fostering innovation and sustainable development for the community and the environment.
SOURCE: MEXICO INDUSTRY
NEWS BY STATE
QUERETARO
The government of Querétaro signed two agreements to enhance collaboration between the International Airports of San Antonio and Querétaro, and to establish a Memorandum of Understanding with Alamo Colleges District and the state’s technological and polytechnic universities. This initiative aims to strengthen commercial ties with the U.S. and Canada, emphasizing the competitive advantages of all three nations. Querétaro currently operates 24 direct commercial routes, serving major business and vacation hubs, and ranks fifth nationally in cargo transport. Governor Mauricio Kuri González highlighted the importance of cooperation in security, economics, and education to foster development and innovation among the countries. San Antonio Mayor Ron Nirenberg noted that this partnership will promote research and expand relationships between the cities, enhancing opportunities for cultural and economic exchange.
SOURCE: MEXICO INDUSTRY
GUANAJUATO
Vehicle production in Guanajuato has progressed over the years, with projections for the end of 2024 estimating total production at 850,000 vehicles, representing an increase of almost 5 percent compared to the previous year. According to Ramón Alfaro, Secretary of Sustainable Economic Development, the automotive industry has become a pivotal factor in the region’s economy and employment. He stated that efforts were made during the administration to further consolidate this sector. He noted that several investment attraction projects have been successful, particularly with Asian countries, highlighting the strong relationships with these nations, which recognize Guanajuato as a region of continuous growth and development.
SOURCE: MILENIO
NEWS BY STATE
JALISCO
A new industrial park, El Roble Industrial Park, is set to be built in Ixtlahuacán de los Membrillos with an investment of 500 million pesos. Located near the Guadalajara International Airport, this development aims to create a new industrial corridor, capitalizing on the airport’s modernization, which is expected to position Guadalajara as Latin America’s top air cargo destination. Jahaziel Castañeda González, vice president of the Mexican Association of Real Estate Professionals in Guadalajara, emphasized the importance of leveraging the nearshoring trend to generate new business opportunities and development in Jalisco. The park is expected to attract economic growth and jobs while facilitating the creation of additional infrastructure in the region. Furthermore, Castañeda noted that both the U.S. and China are looking to relocate businesses to Mexico, highlighting a significant demand for logistics infrastructure due to the increased operational capacity of the local airport. The new industrial park will provide opportunities for companies in manufacturing, logistics, services, and technology.
SOURCE: EL ECONOMISTA
NEWS BY STATE
CDMX
In 2022, tourism in Mexico City surpassed pre-pandemic levels, with a 103% increase in tourist arrivals and a 117% rise in spending compared to 2019, according to Nathalie Desplas Puel, head of the Ministry of Tourism. By September 2024, tourist arrivals and spending are expected to reach 104.4% and 116.4%, respectively, thanks to policies focused on diversification, innovation, and sustainability. Congresswoman Luisa Fernanda Ledesma noted the sector’s strong recovery, while Congresswoman Diana Barragán highlighted Mexico City’s recognition as the best cultural city in 2023, a major draw for visitors. Separately, Minister of Mobility Andrés Lajous Loaeza reported significant improvements in public transportation, including Metro renovations, 504 new trolleybuses, the upcoming Line 3 of Cablebús, and enhancements to the Light Rail system.
SOURCE: EL ECONOMISTA
STATE OF MEXICO
The Huehuetoca-Zumpango industrial real estate submarket has emerged as a leader in logistics space absorption in the Valley of Mexico, surpassing traditionally dominant areas like Cuautitlán, Tultitlán, and Tepotzotlán with 278,709 square meters of transactions in the first half of the year. Its success is due to greater space availability, its strategic location near the northern metropolis, and its proximity to the Felipe Ángeles International Airport (AIFA), which has attracted major companies like DHL and Inditex. DHL is building a 222,967-square-meter logistics facility in T-MEX Park, while Inditex is developing a 55,742-square-meter center.
SOURCE: OBRAS POR EXPANSIÓN
INVESTMENT NEWS
CENTRAL MEXICO
POLY BAJÍO
Poly Bajío, a Mexican company dedicated to polyethylene flexible packaging, announced an investment of 6.7 million dollars to expand its facilities in San Juan del Río, Querétaro. The expansion will create 150 new jobs.
WEG
WEG, a Brazilian manufacturer of motors and supplier of industrial electrical systems, will build a plant in Atotonilco de Tula, Hidalgo, with an investment of 61 million dollars, aimed at the production of wires.
CORBION
The company Corbion inaugurated its plant in Querétaro, where they will produce lactic acid and its derivatives. The Dutch company is located on a 6,000 square meter site, and around 127 jobs are expected to be created.
NORTH
KBY
The Chinese company began its expansion with an initial investment of 20 million dollars in Villa de Reyes. This phase will create 100 jobs. The company aims to generate 1,000 additional jobs by 2026, requiring a 100 million dollar investment for the second phase.
HITACHI ENERGY
The Japanese company Hitachi Energy announced an investment of 70 million dollars in Reynosa, Tamaulipas, with the goal of establishing a manufacturing center specialized in the production of distribution transformers. The new plant will create 350 jobs.
KURTZ ERSA
The German company specializing in mechatronics and industrial automation has announced the opening of a new plant in the Panamericana Industrial Park in Cd. Juarez, which will create 60 highly skilled jobs in the region. The investment amount was not disclosed.
BODA INTERNATIONAL
The Chinese corporation Boda International announced an investment of 850 million dollars to begin operations this year in Nuevo León, aimed at the construction of smart homes.
HITACHI ENERGY
The Japanese company Hitachi Energy announced an investment of 70 million dollars in Reynosa, Tamaulipas, with the goal of establishing a manufacturing center specialized in the production of distribution transformers. The new plant will create 350 jobs.
KURTZ ERSA
The German company specializing in mechatronics and industrial automation has announced the opening of a new plant in the Panamericana Industrial Park, which will create 60 highly skilled jobs in the region. The investment amount was not disclosed.
SOURCES : MEXICO NOW, MEXICO INDUSTRY, CLUSTER INDUSTRIAL
LEGISLATIVE CHANGES AND INITIATIVES
INTERNATIONAL TRADE
• INITIATIVE WITH A DRAFT DECREE AMENDING VARIOUS ARTICLES OF THE FOREIGN INVESTMENT LAW; THE INTERNATIONAL COOPERATION FOR DEVELOPMENT LAW; THE MICROINDUSTRY AND ARTISANAL ACTIVITY LAW; THE LAW FOR THE DEVELOPMENT OF THE COMPETITIVENESS OF MICRO, SMALL, AND MEDIUM-SIZED ENTERPRISES; THE GENERAL LAW ON HUMANITIES, SCIENCES, TECHNOLOGIES, AND INNOVATION; THE LAW TO PROMOTE THE SUSTAINED INCREASE OF PRODUCTIVITY AND COMPETITIVENESS OF THE NATIONAL ECONOMY; THE FEDERAL LABOR LAW; THE GENERAL EDUCATION LAW; AND THE CUSTOMS LAW
Presented by: Sen. Francisco Ricardo Sheffield Padilla (Gto - MORENA)
Purpose: The initiative aims to create a sub-registry for investments focused on relocation, defined as the strategy of transferring or repositioning business or technology operations to Mexico, taking advantage of its proximity to competitive regions for more efficient commercialization. Companies investing in this model must submit a project plan to the Ministry of Economy, which, alongside the Ministry of Finance, will design incentives for this new production model. Social solidarity societies will also participate in relocation projects, supported by various ministries. The Interministerial Commission for the Promotion of Microindustry will be tasked with proposing subsidies and creating a strategic program to involve microindustries in relocation efforts.
The initiative seeks to strengthen the role of MSMEs by enhancing labor skills, recognizing quality, and promoting expertise in artificial intelligence. Maquiladoras and companies in the relocation program will benefit from foreign trade measures coordinated by the Ministry of Finance and Economy.
Status: 2024-09-24 - Published in the Parliamentary Gazette.
LEGISLATIVE CHANGES AND INITIATIVES
LABOR
• BILL PROPOSAL TO AMEND SECTION VII OF ARTICLE 74 OF THE FEDERAL LABOR LAW
Presented by: Senate of the Republic
Purpose: Establishes October 1st as a mandatory rest day every six years, coinciding with the transfer of the Federal Executive Power.
Status: 2024-09-24 - Published in the Parliamentary Gazette of the Chamber of Deputies.
• BILL PROPOSAL TO ADD SECTION XXVII TER TO ARTICLE 132 OF THE FEDERAL LABOR LAW
Presented by: Sen. Luisa Cortés García (OaxMORENA)
Purpose: To establish the obligation for employers to grant paid geriatric care leave of one to five working days to children or caregivers of adults over 60 years old. This leave can be taken twice a year when care or medical attention is needed. The relevant laws and regulations will specify the necessary requirements to access this benefit.
Status: 2024-09-18 - Published in the Parliamentary Gazette.
PRODENSA INSIGHTS
NAVIGATING MEXICO’S LEGAL LANDSCAPE: A GUIDE FOR BUSINESSES
Are you considering expanding your business to Mexico? Understanding the country’s complex legal framework is essential for success. This blog post provides a comprehensive overview of key legal considerations, including labor laws, tax regulations, intellectual property protection, and more.
Learn how to:
• Comply with Mexican labor laws
• Navigate the tax system
• Protect your intellectual property
• Understand environmental regulations
• Establish a legal entity in Mexico
NAVIGATING MEXICO’S EVOLVING
REGULATORY
LANDSCAPE: WHY SHELTER SERVICES MATTER Are you considering manufacturing in Mexico? Understanding the country’s complex regulatory environment is crucial. This blog post explores the latest changes in labor law, IMMEX, trade duties, and more.
Learn how shelter services can:
• Ensure full regulatory compliance
• Simplify market entry
• Manage labor law complexities
• Optimize operations
THE IMPACT OF NEARSHORING ON THE INDUSTRIAL REAL ESTATE MARKET IN MEXICO AND TEXAS
The nearshoring boom is reshaping industrial real estate in Mexico and Texas. As companies shift manufacturing operations closer to the U.S., demand for industrial space is soaring. This trend offers both opportunities and challenges.
Key takeaways:
• Nearshoring’s rise: Driven by supply chain disruptions, labor costs, and USMCA.
• Texas-Mexico trade: A cornerstone of North American manufacturing.
• Industrial real estate boom: Increased demand in Mexico and Texas.
• Opportunities and challenges: Balancing growth with infrastructure and labor needs.