Mexico Manufacturing Supported In New Survey

Mexico Manufacturing opportunities for American businesses have been highlighted in a recent survey (Alix Partners, LLP) undertaken in 2011’s first quarter.  Of the 80 executives responding, 42% who already conduct offshore manufacturing, plan to relocate their efforts closer to the U.S., with 9% already planning to move to Mexico: 33% intend to become Mexico manufacturers in the next one to three years, while 54% said near-shoring is not a current consideration. Entrada Group anticipates this is likely to change, at least for some.  Importantly, 37% of all executives surveyed are conducting offshore manufacturing while another 27% expect to do so by 2014.

The reasons are compelling for U.S. businesses to move manufacturing closer to home as global economic conditions remain in flux. Mexico manufacturers currently operating out of Entrada’s Zacateces facility already benefit from key elements cited in the survey.  The 63% of CEOs who expect to near-shore operations identify Mexico as the most likely location, indicating proximity, increasingly sophisticated transportation networks being developed, and only modest currency fluctuations against the US dollar, which all combine to serve as catalysts for relocation. And while security issues continue to cast a shadow on supply chain disruptions, only 19% of Mexico manufacturers sustained any recent problems. Entrada Group suggests that while disruptions sometime occur in manufacturing in Mexico, this is no less true for other off-shore locations. Notably, the Alix Partners survey was conducted prior to the Japanese Quake and Tsunami. The obvious conclusion is that potential supply chain disruptions can be caused by numerous factors.


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