123ArticleOnline Logo
Welcome to 123ArticleOnline.com!

ALL >> Business >> View Article

Mexican Manufacturing Benefits Us Industry

By Author: Alan Russell
Total Articles: 53

When NAFTA was first implemented in the early 1990s, the fear was that Mexican manufacturing would cost the US jobs and wreak havoc upon US industry. Mexico was viewed largely as an economic competitor that would pilfer US employment opportunities, businesses, and bring about the demise of national economic prosperity. This set of assumptions was merely the result of a misconception of the nature of the US-Mexico industrial alliance.

In reality, China has been a much more formidable concern in terms of low wages and competition for industry stateside. The past decade, however, has amply shown that the best way for US industry to meet this challenge is partnership – not competition – with Mexico through production sharing, or vertical specialization, which occurs when two or more countries bilaterally produce a product. In other words, Mexican manufacturing firms rely upon materials produced by US suppliers. The geographic proximity of Mexico and the US has actually led to greater opportunities for US suppliers vis a vis China. This is demonstrated by the fact that Mexican imports contain ten times more U.S. content than similar items manufactured by the Chinese. In fact, 40% of the United States’ imports from Mexico contain material inputs that originated in the United States.

Thus we see that “near-sourcing” manufacturing jobs to Mexico is, in a palpable way, beneficial to US industry, fostering a partnership that keeps high paying jobs in the US and sustains a demand for suppliers to feed the manufacturing done in Mexico that will then be exported, in most instances, back to the US. This partnership results in products that, when sitting on shelves next to those produced in China and other developing countries such as India, Brazil, Indonesia, Vietnam and Malaysia, are price competitive.

With the aforementioned in mind, it is no surprise that one in twenty-four US jobs is dependent on the Mexican maquiladora industry. Over 6 million US jobs are dedicated to supplying manufacturing operations in Mexico, which means there is significant opportunity for US suppliers to expand to meet the demand created by Mexican manufacturing activities.

Four segments in particular presently stand out as unique growth opportunities for US industry:

In 2011, the Mexican automotive industry achieved a growth rate of thirteen percent. As a result, the demand for US made parts and supplies is on the rise – these include items such as spare and replacement parts for gasoline and diesel engines, electrical parts, collision repair parts, gear boxes, drive axles, catalytic converters, and steering wheel assemblies, for example.

In 2010 alone, Mexico imported approximately $3.5 billion worth of products for the manufacturing of medical devices, $2 billion of which were from US suppliers. Key opportunities for medical products suppliers include anesthesia equipment, defibrillators, electrocardiographs, electro surgery equipment, incubators, lasers for surgery, etc.

Total Mexican packaging production reached 9.1 million tons of containers and materials in 2010 for a value of $10.1 billion, of which $2.5 billion came from US industry. There is significant growth potential for US suppliers of metal, plastics, glass, wood, and cardboard packaging materials.

$1.4 billion was invested in plastics manufacturing in Mexico in 2011, revealing a steady rise in the demand for plastic materials and resins. Additionally, Mexico exports Ethylene and imports Polyethylene, which shows the opportunity for US industry to supply polymerization technology.

Mexican manufacturing, although this may be counter intuitive to some, should be viewed as a partner to the US, rather than exclusively as a competitor.


K. Alan Russell, President and C.E.O. of the Tecma Group of Companies. manufacturing in Mexico, Mexico manufacture, nearshore manufacturing

Total Views: 74Word Count: 592See All articles From Author

Business Articles

1. Top Reasons To Buy A Lamborghini Aventador Super Car
Author: Jason Jones

2. What Are The Most Common Carpet Stains At Your Oahu Home?
Author: Kleenprohawaii

3. Our Mission - Cjs Haritha Homes
Author: 0

4. The Shared Fibers Wallet In-depth Review
Author: Lao Yutang

5. The Worst Things About Orlando Wedding Photography That Budding Wedding Photographers Must Take Into
Author: Vikram Kumar

6. Get The Right Ceo Mailing Lists For Your B2b Targeted Marketing
Author: germany email datasupply

7. Carpet And Upholstery Cleaning In Newport Beach
Author: carpetcleaninginnewportbeach

8. Meishen Hold A Contest Of Tug-of-war
Author: hu Allen

9. Avail Budget Interior Designers In Bangalore For Best Services
Author: johnsdaniey

10. Looking For Quality Dietitian Leads To Grow Your Business? Switch To Averickmedia
Author: Andrew Rayel

11. Buy Most Noteworthy Quality Upvc Item On-line
Author: sandip m

12. Burnerindo Teknik Utama
Author: btu.co.id

13. Huge Profits In Carpet Cleaning Business
Author: Drcarpetirvine

14. Tips For Buying Shin Pads For Kids
Author: Sahah Chan

15. High-quality Yet Affordable Plumbing Services In Durban
Author: Donald Frank

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: