Despite Lackluster Sales, Mexico's Manufacturing Industry Thrives

Although exports from Mexico to the U.S. have recently decreased, the U.S. Manufacturing industry in Mexico remains a stronghold in the Mexican economy. Revenue in exports reached close to $65 billion in 2010, exceeding revenues from crude oil, remittances and tourism combined and its predicted that by 2014, automotive production will reach 2.4 million units. Part of the reason for this is that eight of the 10 leading OEM’s have assembly plants in Mexico: more than 300 Tier 1 suppliers are manufacturing in Mexico including: Chrysler, Ford, GM, Honda, Nissan, WV and Toyota. Heavy truck manufacturers present in Mexico include Dina, Navistar, Kenworth, Daimler, Volvo, Isuzu and Scania. With such a well-established U.S. manufacturing industry in the country, Mexico keeps capturing the attention of new car manufacturers such as Mazda -- the company recently announced plans to invest 500 million dollars to produce 140,000 vehicles a year for export to Central and South America. Why so much investment in Mexico? Well, Mexico offers manufacturing costs that are 25% lower than the U.S. and it's estimated that by 2020, sales from the automotive industry in Mexico are expected to reach 120 billion dollars.