GENERAL SITUATION IN MEXICO
Weekly Review I October 23, 2024
RELEVANT NEWS INDUSTRIES
EV
Grupo Modelo has successfully retrofitted a truck over 10 years old into a 100% electric vehicle, in partnership with Evolectric, to demonstrate the feasibility of repurposing older trucks for electric use. Marcela Tovar, LATAM Business Development Manager at Evolectric, emphasized that electrification shouldn’t be limited to new vehicles and adapting older ones is a sustainable approach. The project achieved a 15% reduction in fuel costs compared to diesel and an 83% decrease in energy-related operational costs, with the truck demonstrating energy efficiency of over 1 km/kWh. It can charge between 10% and 70% of its battery, with capabilities up to 100 kW, averaging a charging speed of 98.27 kW. Conducted in a Mexican workshop, the retrofit took approximately one week, but future conversions are expected to be completed in two days through collaboration with U.S. companies to streamline the assembly process. This initiative highlights the potential for sustainable solutions in the automotive industry across Latin America.
SOURCE: MEXICO BUSINESS NEWS
Volkswagen Group is significantly expanding its manufacturing presence in North America, particularly focusing on electric vehicle (EV) production and battery plants, while simultaneously transforming its logistics operations in Mexico. Peter Koltai, senior director for production control and logistics at Volkswagen de Mexico (VWdM), is implementing predictive analytics, artificial intelligence (AI), and enhanced regional collaboration to address supply chain challenges and support the company’s electrification goals. The Puebla plant is central to this expansion, evolving to accommodate new EV production alongside a network that includes multiple sites across North America. VWdM has merged its inbound and outbound logistics teams for a more holistic approach to material and vehicle logistics, which is vital for upcoming EV initiatives. Digitalization efforts have improved transparency and decision-making, with predictive analytics enabling the early identification of potential supply chain disruptions. Additionally, VWdM employs data-driven supplier risk management to preemptively address delivery and quality issues. The company’s collaborative efforts extend beyond Mexico, as it has established a joint control tower for vehicle logistics across North America to enhance operational efficiency and manage capacity bottlenecks.
SOURCE: AUTOMOTIVE LOGISTICS
RELEVANT NEWS
BUSINESS CHAMBERS
INDEX MEXICALI
Congratulations to Index Mexicali on 50 years of industry leadership and excellence. It was a pleasure for Emilio Cadena, CEO of Prodensa, to participate in this significant milestone at Foro Index Mexicali. The panel on “X Shoring Impact”, alongside Salvador Maese, President of Index Mexicali, provided valuable insights into the future of nearshoring and the role of Mexico in the global supply chain.
Wishing Index Mexicali continued success and growth in the years to come.
SOURCE: PRODENSA
NEWS BY STATE
BAJA CALIFORNIA
The Economic and Industrial Development of Tijuana (DEITAC) held its bimonthly meeting with Nora Vargas as the guest of honor, highlighting her commitment to the binational dynamic of the San Diego-Tijuana mega-region. Cristina Hermosillo, president of DEITAC, emphasized the importance of the alliance with Vargas, who serves as San Diego County Supervisor and chair of SANDAG, in promoting economic growth at the border. Vargas, with a strong political background, shared her dedication to advocating for cross-border residents and presented initiatives such as the binational ferry and trolley, Otay II Port of Entry, and water treatment projects. DEITAC continues to foster the CaliBaja mega-region, seeking to replicate successful practices from regions like Singapore and welcoming new partners to strengthen innovation and economic development.
SOURCE: INDUSTRIAL NEWS BC
SONORA
During the US-Mexico CEO Dialogue in Mexico City, Sarah Bairstow, CEO of Mexico Pacific, announced a $15 billion investment to build a liquefied natural gas (LNG) plant in Puerto Libertad, Sonora. The Saguaro Energía plant will liquefy gas from the U.S. for export to Asia, enhancing Mexico’s role in the global energy trade. With a capacity of 15 million tons per year, preliminary work has already begun, including land movement and site preparation. The project will also include pipelines and transportation routes, as well as the Sierra Madre gas pipeline to transport 2.8 million cubic feet of natural gas daily. Bairstow emphasized that the project’s infrastructure design aims to generate economic benefits while incorporating unprecedented social investments for northern Mexico. The Saguaro Energía plant has a 20-year LNG export permit, allowing for continued construction phases, but its success relies on effective coordination between the two countries to complete necessary border connections.
SOURCE: CLUSTER INDUSTRIAL
NEWS BY STATE
CHIHUAHUA
During her working tour in Taiwan, Chihuahua Governor Maru Campos met with key players in the semiconductor industry, including the Semiconductor Industry Association (TSIA), Foxconn, Pegatron, and United Microelectronics Corporation (UMC), to promote Ciudad Juárez as a strategic location for supply chain investments. She highlighted the region’s competitive advantages, including incentives and proximity to North American markets under the USMCA. Campos invited executives to explore Chihuahua’s potential, especially within the binational semiconductor ecosystem. She also discussed infrastructure and employee welfare with Pegatron and reviewed future expansion plans with Foxconn. Additionally, Campos attended the 50th-anniversary dinner of the Electrical and Electronic Manufacturers Association (TEEMA), which represents 3,000 electronics manufacturers.
SOURCE: MEXICO NOW
NUEVO LEON
At the panel “Prosperity with Equity: SMEs and Inclusive Industrial Development” during the Annual Meeting of Industrialists, Nuevo León Governor Samuel García Sepúlveda discussed his government’s initiatives to capitalize on nearshoring. He announced the renewal of customs concessions and infrastructure improvements for Puerto Colombia, aiming to increase crossing operations from 2,000 to over 8,000 annually. García emphasized the importance of integrating SMEs into North American value chains, urging them to understand the USMCA to benefit from zero tariffs. He highlighted a financing initiative supporting approximately 3,500 SMEs, enabling them to secure loans without traditional guarantees. The panel was moderated by Alejandro Malagón, with contributions from key industry leaders.
SOURCE: EL ECONOMISTA
NEWS BY STATE
COAHUILA
Coahuila’s Secretary of Economy, Luis Eduardo Olivares Martinez, participated in the Third Mexico-U.S. Semiconductor Collaboration Forum in Ciudad Juarez, emphasizing the state’s pivotal role in the automotive sector and its potential in the semiconductor industry. The forum gathered key public and private sector stakeholders to discuss investment opportunities, technological advancements, and supply chain strengthening in North America. Martinez highlighted Coahuila’s favorable investment ecosystem, skilled workforce, and robust infrastructure, which support innovation and growth in this sector. The event featured discussions on attracting investment for chip development, with representatives from major companies like Intel, Infineon Technologies, and Qualcomm, while outlining Coahuila’s initiatives, including strategic partnerships with universities and tax incentives, to position the state as a technology industry leader.
SOURCE: MEXICO NOW
NEWS BY STATE
GUANAJUATO
To explore collaboration opportunities and learn from a successful logistics-industrial model, Colima’s Secretary of Economic Development, Francisco Javier Rodríguez García, officially visited Guanajuato Puerto Interior (GPI), the most important dry port in Latin America. During the meeting, GPI’s General Director, Héctor López Santillana, presented the project’s origins and development, outlining a work agenda focused on experience transfer and strengthening cooperation between the two regions. Rodríguez García emphasized plans to develop a similar logistics-industrial complex in Colima to complement its major maritime port in Manzanillo. Additionally, the Colima delegation toured Orbis Plastic Molding in Mexico, where General Director Alberto Soto Ontiveros highlighted the strategic advantage of being located within the GPI ecosystem, which has optimized their logistics and product distribution.
SOURCE: MEXICO INDUSTRY
AGUASCALIENTES
To strengthen commercial ties, promote technology transfer, and explore new investment opportunities, Aguascalientes Governor María Teresa Jiménez Esquivel met with representatives from German companies operating in the state. She expressed gratitude for their contributions to the local economy and reaffirmed the government’s commitment to creating a conducive environment for their growth. The governor emphasized the importance of ongoing dialogue and collaboration to build strategic alliances that foster industrial growth and mutual benefits. Esaú Garza de Vega, head of the Secretariat of Economic Development, noted that under the current administration, Aguascalientes has attracted $220.4 million in foreign direct investment from Germany, totaling $1.08 billion since 2006. The meeting included executives from notable companies such as Balluff, ContiTech, and Mercedes Benz, alongside state officials and local deputies.
SOURCE: MEXICO NOW
NEWS BY STATE
SAN LUIS POTOSI
The Automotive Cluster of San Luis Potosí and Aliat Universities held the congress “Automotive Connection: Empowering University Talents, the Engines of Tomorrow.” This event brought together representatives from the automotive and educational sectors to strengthen the integration of young talents into the industry. The inauguration featured Néstor Eduardo Garza Álvarez, head of the Ministry of Labor and Social Welfare, and Víctor Román, rector of UTAN Campus Industries. The congress included various inspiring presentations, such as the keynote address by Fermín Fernando Mojica Araujo from Tecnológico de Monterrey, a discussion panel on integrating young talent in the automotive sector with leaders from General Motors, Martinea, and DRÄXLMAIER Group, and additional talks focusing on entrepreneurship and inspiring the next generation of university talents.
SOURCE: MEXICO INDUSTRY
NEWS BY STATE
CDMX
The principle of Extended Responsibility mandates that producers, manufacturers, and distributors share the responsibility for managing the full lifecycle of their products, including post-consumption waste. This is integrated into a Circular Economy Plan, which sets specific targets for material recovery and recycling, aligned with Circular Economy principles. All entities involved in packaging production or import must submit a Circular Economy Plan to authorities. Companies with certifications or programs that meet Circular Economy standards may register them as their official plan. The Circular Economy Plan is a collaborative administrative tool between industry stakeholders and government, designed to achieve sustainability objectives. Sectors transforming plastics must incorporate extended responsibility in their plans and create public education programs promoting proper waste separation at the source. This approach aims to reincorporate waste into production processes, maximizing its value and ensuring that waste management is shared across all sectors of the product lifecycle.
SOURCE: CONGRESO DE LA CIUDAD DE MÉXICO
STATE OF MEXICO
In the third quarter of 2024, the State of Mexico attracted $1.6 billion in foreign direct investment (FDI), nearly doubling the $1.7 billion from the first two quarters. Over 10 companies contributed to this growth, with notable investments from Prologis Park Lerma ($235 million), Grupo Danhos ($250 million), and Grupo Coppel, which invested $1.4 billion pesos to open 14 new stores. McCormick expanded its operations with $3.4 million, while Axalta Coating Systems invested $60 million in its facilities. Bayer announced $63.86 million for its Lerma plant expansion and a new Innovation Center. Ultra AC Desarrollos invested $77.96 million in an industrial park. The manufacturing industry remains the largest contributor to FDI in the region, accounting for $28.5 billion since 2006. Overall, the State of Mexico secured over $3 billion in FDI so far in 2024, positioning it as the third-largest FDI recipient in Mexico.
SOURCE: LA JORNADA
INVESTMENT NEWS
CENTRAL MEXICO
BOSCH
The Bosch Aguascalientes plant, located in the Valle de Aguascalientes Industrial Park, inaugurated its new production lines with an investment of 220 million dollars and plans to generate 400 new jobs by 2027.
SEGULA TECHNOLOGIES
SEGULA Technologies will open two new offices in Querétaro and Puebla, with the aim of supporting industrial players in the efficient mobility solutions. The opening of these new offices will facilitate the hiring of over 200 engineers in the regions of Querétaro and Puebla.
MEXSTAMP
The company specialized in machining and stamping auto parts will invest 3,8 million dollars in the construction of a second plant in Aguascalientes. It currently operates a plant located in the Chichimeco Industrial Park, in Jesús María.
NATIONAL
ASTRAZENECA
AstraZeneca announced an investment of over 45 million dollars for the period 2024-2025. This initiative will launch 20 new medications by 2030.
SOURCE: MEXICO INDUSTRY, EL ECONOMISTA
LEGISLATIVE CHANGES AND INITIATIVES
LABOR
• THE TWELFTH SECTION OF PART A OF THE SECOND PARAGRAPH OF ARTICLE 123 OF THE CONSTITUTION IS AMENDED AND SUPPLEMENTED TO CREATE A HOUSING SYSTEM FOR ALL WORKERS.
Presented by: Chamber of Deputies
Purpose: Agricultural, industrial, and other companies are required by law to provide workers with adequate housing through contributions to a national housing fund. This fund offers affordable housing loans or rental opportunities after one year of contributions, ensuring that rent does not exceed 30% of workers’ salaries. Priority is given to continuous contributors without home ownership.
Status: The Reform is being discussed in the Commission in the Chamber of Deputies
• SEVERAL ARTICLES AND SECTIONS OF THE CONSTITUTION REGARDING MINIMUM WAGE
Presented by: Chamber of Deputies
Purpose: The proposal stipulates that the annual setting or revision of general or professional minimum wages will never fall below the observed inflation rate during their validity period.
Status: Constitutionally approved by 17 Local States’ Congresses. It will be sent to the Executive and published in the Official Gazette.
LEGISLATIVE CHANGES AND INITIATIVES
• SEVERAL ARTICLES AND SECTIONS ARE ADDED AND MODIFIED IN THE FEDERAL LAW OF WORK REGARDING WORK HARASSMENT
Presented by: Chamber of Deputies
Purpose: The reform defines workplace harassment as acts or behaviors at work that harm self-esteem, health, freedom, or safety, regardless of hierarchy. Harassment is grounds for dismissal without employer liability, and employers must implement protocols to prevent it. Unions are also prohibited from engaging in harassment. Employers may face fines for tolerating harassment, and conciliation is not required in harassment-related conflicts.
Status: Presented to the plenary of the Chamber of Deputies
• DRAFT DECREE ADDING SECTION VIII TO ARTICLE 537 OF THE FEDERAL LAW OF WORK
Presented by: Chamber of Deputies
Purpose: It establishes that the National Employment Service will aim to create programs that provide young people with their first job, promoting their inclusion in the labor market.
Status: Presented to the plenary of the Chamber of Deputies
• INITIATIVE THAT ADDS VARIOUS PROVISIONS TO THE FEDERAL LABOR LAW
Purpose: A new chapter titled “Work through Digital Platforms” is added to the law. It defines digital platform workers as those receiving instructions via technology for services like transport, food delivery, and home repairs. These workers will have the same rights as others under the Constitution and be connected to social security within 30 days.
Presented by: Chamber of Deputies - Manuel de Jesús Baldenebro Arredondo (MORENA)
LEGISLATIVE CHANGES AND INITIATIVES
INTERNATIONAL TRADE
• SECOND RESOLUTION OF MODIFICATIONS TO THE GENERAL RULES OF FOREIGN TRADE FOR 2024 AND ANNEXES 1, 2, 5, AND 24
Presented by: Tax Administration Service (SAT)
Purpose: To inform about the modifications to the General Rules of Foreign Trade regarding customs accounts, RFC (Federal Taxpayer Registry), importation of vehicles under duty exemption, courier and parcel companies, company certification, among others.
• ANNEX 1-A OF THE SECOND RESOLUTION OF AMENDMENTS TO THE MISCELLANEOUS TAX RESOLUTION FOR 2024, PUBLISHED ON OCTOBER 11, 2024
Presented by: Tax Administration Service (SAT)
Purpose: To announce the modifications to the miscellaneous tax resolution for 2024
ENERGY
• THE ARTICLES 25, 27, AND 28 OF THE POLITICAL CONSTITUTION OF THE UNITED MEXICAN STATES ARE REFORMED CONCERNING THE STRATEGIC INDUSTRIES OF THE STATE.
Presented by: Chamber of Deputies
Purpose: The reform states that no concessions will be granted for lithium, ensuring public enterprises prevail over private ones. The state will maintain exclusive control over internet services, aiming to secure electricity transmission and distribution while preserving national energy self-sufficiency.
Status: Turned to Local Congresses for its approval
PRODENSA INSIGHTS
Prodensa congratulates Isabel Clavijo, Vice President of Institutional Relations, on her appointment as President of the Foreign Trade and Logistics Committee at the American Chamber of Commerce of Mexico (AmCham). Isabel will focus on improving business conditions, trade, and supply chain integration, strengthening U.S.-Mexico relations. Prodensa fully supports her leadership and looks forward to continued collaboration with AmCham to drive economic growth.
HOW NEARSHORING & INDUSTRIAL POLICY CAN DRIVE GROWTH
In a recent event hosted by the Mexican Institute for Competitiveness (IMCO), experts emphasized how nearshoring and a well-crafted industrial policy could position Mexico as a key player in global supply chains. Mexico’s geographic advantage and ties to the U.S. make it well-placed to attract investment, but challenges remain—especially in high-tech sectors still reliant on China. The event also highlighted the crucial role of SMEs in Mexico’s growth and the need for a robust industrial strategy, focusing on advanced manufacturing, electronics, and infrastructure development, to fully capitalize on nearshoring opportunities.
FURNITURE MANUFACTURING IN MEXICO
Mexico has rapidly become a global powerhouse in furniture manufacturing, boasting over $12.8 million in exports annually, with 94% destined for the U.S. From leading cities like Guadalajara and Chihuahua to major players such as La-Z-Boy and IKEA, Mexico’s strategic advantages—skilled labor, competitive production costs, and proximity to key markets—continue to attract foreign manufacturers. With a focus on quality craftsmanship, sustainability, and innovation, the Mexican furniture industry is poised for further growth. VISIT THE INSIGHTS SECTION ON OUR WEBSITE TO SEE SOME HIGHLIGHTED SUCCESS CASES.