The Many Advantages Of Manufacturing In Mexico

We’ve outlined why manufacturing in Mexico will continue to thrive, and we stand by those words. However, for those still wary of manufacturing in Mexico, here’s a list of benefits.

Inexpensive Shipping And Labor Costs

The most obvious benefits to manufacturing in Mexico are lower costs. While per-piece manufacturing can be cheaper in East Asia, those cost savings are offset when shipping cargo halfway around the world. Those costs are already expensive and are expected to rise in the coming years. Besides, trans-oceanic shipping only makes sense when ordering a full container. Parts and components from Mexico can be shipped in smaller quantities, such as a pallet.

As for labor costs, Mexico’s average labor rates are actually lower than labor rates in China.

Short Supply Chain

When you build your components in Mexico, your supply chain is a fraction of what it would be elsewhere in the world. If you had an urgent order from one of your biggest customers say, tomorrow, a manufacturer in east Asia definitely wouldn’t be able to get the parts to you right away. When you manufacture in Mexico, those parts could be delivered to you via truck freight a day or two after manufacturing is finished.

Intellectual Property Protection

According to IndustryWeek.com, Chinese entities are responsible for up to 80% of all US intellectual property theft. When you build your parts in Mexico, you gain the intellectual property laws that are closely aligned with Canada’s – and that is good news for your business.

Close Proximity

If you had a choice to work at an office five minutes from home as opposed to an hour from home, would you take it? Of course!

Manufacturing in Mexico is a lot like that when you consider the time commitment required when your manufacturing plant is overseas. Here’s what you gain with close proximity to Mexico:

• Faster, cheaper flights. Let’s say you operate out of Detroit. A flight to Shanghai will cost you $1500, and it takes 14 hours to get there. However, a flight to Mexico City is only $700, and it takes four hours to get there.
• Time difference. When it’s 6 a.m. in Detroit and the day is just starting, it’s 6 p.m. in Shanghai. That means when it’s time to do business, someone’s going to have to work after hours. Mexico City is only a one hour time difference, and that makes business easier.
• No jet lag! When you make the flight to China, you’re going to lose a week of productivity due to jet lag. People often need a day or two to adjust to the time change on both sides of the trip. When you make the flight to Mexico, the time change is not a concern.

Experienced Workers

Auto parts manufacturing is nothing new to Mexico. Experienced parts manufacturers such as Intran have built a variety of parts and components for decades, which not only reduces costs but also increases quality.

That may have something to do with the 115,000 engineers Mexico graduates every year, which is more, per capita, than the US! And on top of that, Mexico has more skilled laborers in manufacturing, construction, and engineering per capita than most other countries.

Social Responsibility

When you manufacture in Mexico, you’re working with a country that’s socially responsible when it comes to their workers and products. We live in a world increasingly concerned about the origin of their products and under what conditions they were built.

1. Mexico’s labor laws mirror those of the US and Canada, promoting a maximum 48 hour work week. This is in stark contrast to Asian manufacturing facilities, where 60 hour workweeks are normal.
2. Mexico has instituted strict worker safety practices and regulations and rules against child labor. That way, you won’t run into any public relations issues like those faced by Beyonce’s Ivy Park clothing line.
3. Mexico uses safe materials, unlike some manufacturing facilities scattered throughout Asia that use tainted raw materials, which often results in safety recalls or premature failure.

A Pro-Business Environment

When considering Mexico’s pro-business environment, look no further than the 12 free trade agreements signed with 44 countries. In terms of infrastructure and economic policies, that makes Mexico one of the most flexible countries in the world. You can thank Mexico’s long history of consistent regulations, transparency, and democratic values for that.

Image via Omaha.com and the Associated Press.

An Experienced Partner

Perhaps most importantly, you gain an experienced partner when you manufacture with a company like Intran. Our English-speaking associates are on-hand to answer any questions you may have about moving your operations to Mexico. If you are ready to get started or have any inquiries at all, don’t hesitate to give us a call.