In today’s dynamic manufacturing environment, companies have several attractive options to consider when expanding, relocating or simply starting a new manufacturing facility. How do corporations facing today’s challenges weigh their manufacturing options? Low cost is an influential factor but it is not always the top of the list, there are other important factors to consider such as low-cost manufacturing, strategic location, quality and experience, just to name a few. In this playing fields Mexico certainly makes a compelling case for itself when compared to China. Visit www.co-production.net to learn how to increase your bottom line profits and gain a competitive advantage over the competition.

1. n today's dynamic manufacturing However, recent studies have shown that
I environment, companies have several
attractive options to consider when
expanding, relocating or simply
starting a new manufacturing fac ility. T he
global economy is still healing from the
although cost is an influential factor, it is not
always at the top of the list. There are other
important factors to consider such as strategic
location, quality and experience j u st to name
a few. In this playing field, Mexico certainly
economic downturn of the past years, but makes a compelling case for itself when
there is a light at the end of the tunnel. compared to China.
Mexico and China are poised, standing
ready, willing and able to attract world class LOW-COST MANUFACTU R i NG
manufacturing to their shores.
In the last decade Chinese labor rates have
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How do corporations facing today's increased significantly. Thday the average
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<> challenges weigh their manufacturing wage of a manufacturing employee in China is
Z options? One would assume that cost is between $1.65 and $1.85 per hour. Of cou rse,
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, at the top of the list for most, and, to no labor rates are contingent upon the location of
M surprise, China - as well as other Asian the factory as well as the industry they serve.
Z countries- has held the top spot for low-cost
o manufacturing in the last two decades. Mexico, for the most part, has rema ined stable
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2. in its labor rate averaging anywhe re from Q U ALITY AND EXPERIENCE
$1,85 to 52.25 per hour (also contingent
upon location and industry). Something Mexico's entry to the manufacturing
else to consider is the hours an employee arena began more than SO years ago.
works per week. For example, China has a At it's inception, the draw for foreign
44-hour work week and Mexico has a 48- manufacturers was its low-cost labor
hour work week. Mexico has roughly a 10 rates. lbday the manufacturing landscape
percent advantage in this respect. is much different; Mexico has attracted
global corporations such as Volkswagen,
Other cost components to consider are GM, Bombardier, Bose, Eaton and other
the duties and tariffs imposed on Chinese world class companies by proving jt has the
products imported to the U.S. Be they technical skills and capabilities to compete
finished goods or raw materials, costs can be not only in North America, but on the world
significantly higher than those imposed on stage as well.
Mexican products. 1n many cases, because
of NAFTA, Mexican raw materials pay zero Many of today's Mexican manufacturing
duties and finis h ed goods pay only on the plants reach fa r beyond simple a ssembly.
value added portion of their cost component It is not uncommon to find companies
when entering the u.s. and some European that design, develop and manufacture
coun tries. some of the most complex products in
the marketplace in a variety of industries.
STRATEGIC LOCATION Aerospace, automotive, medical and
electronics manufacturing companies
As the saying goes "locatio n, location, find themselves at home in Mexico. From
location" and Mexico's location is ideal pacemakers to airplanes, Mexico meets and
for companies selling into the North exceeds the standards set by world class
American and European marketplace. companies. A close working relationship
l'laving a manufacturing site hours from between industry and higher educa tion has
the consumer saves on transportation costs. made this possible. Cu rricula at universities
The average transit time from the moment and technical schools are now shaped by
a shipment departs China to the time it the specific demands of industry.
arrives in the U.S. is 30 days resulting in
higher costs. Mexico delivery times are "BIENVENIDO A MEXJ CO"... WELCOME
far less; depending on the origin of the TO A'i.EXICO
shipment, it can take anywhere from a few
hours to a few days for a product to arrive at One last key component to conside r when
its destination. discussing Mexico vs. China is culture
and language. Though they are not
Mexico's strategic location is ideal for several mutually exclusive, cultural and language
other reasons. First, companies can maintain barrie rs can pose a threat to the success
"just-in-time" delivery to the ir consumers of any manufacturing site. Working in the
and distributors. Second, reaction time to manufacturing sector, it is almost certain
any production or operational issues on the that a Mexican national will speak English
factory floor can be resolved in hours, not and, along the border, the workforce is not
days or weeks. Third, maintaining greater only bilingual but bicultural as well.
operational control of the manufacturing
base is less challenging because of its Mexican and U.S. cultures are no doubt
proximity to the corporate office. different in many ways, but they are both
western cultures and in that regard, share
And let's not forget about South America. It more similarities than North American and
has also developed an insatiable appetite for Asian cultures do. The U.S. and Mexico also
North American and Euro pean goods from share common interests and are more likely
cars to electronics to household appliances to concur in best practices as they relate M
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and everything in between. Having a to global competitiveness. In a nu tshell,
Mexican manufacturing base provides
companies with an oppo rtunity to tap into
the u.s. and Mexico cultural similarities
will undoubted ly ensure the global
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,
the South American marketplace while competitiveness and economic prosperity M
at the same time supplying their North of those companies willing to venture into Z
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American and European consumers, new horizons. Cl z
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