Japanese Manufacturers Seek an Edge in Central Mexico

Commentary by Doug Donahue

As this article in Transportation in Japan shows, Japanese manufacturers are coming to central Mexico to leverage Mexico’s free trade agreements (Mexico has more than any other single nation) in both North and South America, as well as in Europe.

As the piece states, Nissan, Toyota and Honda are already manufacturing in Mexico. In fact, Nissan, the second-largest Japanese automaker and 6th largest globally, announced last year plans to open a third manufacturing facility in Mexico. There are a total of 25 different auto manufacturing units in Mexico with an output of over 2 million cars each year.

Why Central Mexico?
There are many reasons that manufacturers from numerous industries (chiefly automotive, aerospace and electronics) have transitioned to central Mexico, reflecting growing demand here, over border regions: competitive wages, solid infrastructure, convenient access to suppliers, tradition of manufacturing in the area and others.

Japanese companies have been producing locally in the area and exhibit a strong presence in Aguascalientes and Leon, in particular. Movement to the area reflects a concern for the strong yen as well as confidence that central Mexico will continue to offer strong opportunities for topline growth over the long term.

Entrada Group’s expansion into central Mexico reflects growing interest on the part of foreign-based manufacturers on the region, and signals our own confidence in the area’s stability and the opportunities it presents.

Source: Transportation in Japan

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