Why Manufacture in Nuevo Leon, Mexico?

Nuevo Leon is a state in northeastern Mexico known for its strong economy and industrial sector, particularly in Monterrey, the capital of the state. Monterrey is the third-largest city in Mexico and is often referred to as the “industrial capital” of the country.

Monterrey is home to many large national and international corporations, and it has a long history of being a hub for manufacturing and industrial production. The city is mainly known for its expertise in automotive, aerospace, electronics, and metal fabrication industries.

Nuevo Leon’s strategic location near the United States border and its access to major highways, railroads, and airports make it an ideal location for businesses that require easy transportation of goods and materials to and from the United States. Additionally, the state offers a skilled workforce and a business-friendly environment, which has made it a popular location for companies looking to establish manufacturing operations in Mexico.

Some notable companies with manufacturing operations in Nuevo Leon include American Axle Mexico, ITW Automotive Products Mexico, and various wholesale clothing manufacturers and suppliers. The state also has a strong presence in the aerospace industry, with companies such as Honeywell and Safran having manufacturing facilities in the area.

Thanks to its low labor costs, favorable trade agreements, and strategic location, Mexico has become a go-to destination for manufacturing companies. One state that stands out, in particular, is Nuevo Leon, home to various industries, including automotive, aerospace, electronics, and textiles. In this article, we will explore why manufacturers should consider setting up shop in Nuevo Leon.

Low Labor Costs

One of the most significant manufacturing advantages in Nuevo Leon is its low labor costs. Mexican workers earn considerably less than the United States and other developed countries, making it an attractive location for labor-intensive industries. According to data from the International Labor Organization, the average hourly wage in Mexico is $3.95, compared to $24.34 in the United States.

Favorable Trade Agreements

Mexico has an extensive network of trade agreements, including the United States-Mexico-Canada Agreement (USMCA), which replaced the North American Free Trade Agreement (NAFTA) in 2020. The USMCA provides duty-free access to the US and Canadian markets for goods produced in Mexico, making it an ideal location for manufacturers looking to export to these countries.

Diverse Industry Clusters

Nuevo Leon has several industry clusters, including automotive, aerospace, electronics, and textiles. American Axle Mexico, ITW Automotive Products Mexico, and several other global automotive manufacturers have established operations in the state, attracted by its skilled workforce and strategic location. The state is also a hub for aerospace companies, with firms such as Honeywell, Safran, and Bombardier operating in the region. The electronics industry is also well-represented, with contract manufacturers such as Jabil and Foxconn operating in the state.

Competitive Supply Chain

Manufacturing in Nuevo Leon also benefits from its competitive supply chain. The state has a robust network of suppliers, including metal fabrication companies and wholesale clothing suppliers. This allows manufacturers to source materials and components locally, reducing costs and lead times.

In conclusion, Nuevo Leon, Mexico, offers a compelling value proposition for manufacturers looking to optimize their production costs and expand their market reach. With its low labor costs, favorable trade agreements, diverse industry clusters, and competitive supply chain, it’s no wonder why so many manufacturing companies are moving to Mexico. If you want to set up a manufacturing operation, Nuevo Leon should be on your list.