New Market Study Published: Consumer Electronics in Mexico
March 6, 2014
March 5th, 2014 — Manufacturers of Consumer Electronics are Moving to Mexico to Reduce Costs.
In a move to reduce costs manufacturers are choosing to manufacture in Mexico over long time competitor China, as the ideal location to produce their consumer electronics.
Consumer electronics has shown strong growth in Mexico and will continue to expand, as more and more companies begin to tap the rich mine of labor in Mexico that is both educated and skilled. With the United States in close proximity to Mexico, companies are rethinking their manufacturing and the logistics of getting the products into various avenues of North America. Mexico has recently begun incorporating new innovative technology into its manufacturing, which also appeals to companies wanting to maintain a competitive edge in relation to their competitors. In areas such as prototyping of products and aftermarket services, Mexico has proved to be rated superior to China.
The young and educated workforce has been a large factor in the increase of consumer products manufacturing in Mexico. In fact, 114,000 engineering and technology graduates have recently entered the job market within the country. Moreover, progressive technology is another reason companies are rethinking and relocating their manufacturing to Mexico from China.
At present, Mexico is the second-largest supplier of electronics to the U.S. market. Included are the manufacturing of audio and video devices, telecommunications and computer equipment. Mobile technology is especially strong in Mexico; it is the third-largest exporter of cell phones. Studies have shown that 65 smartphones are sold per minute within Latin America.
With the implementation of the Maquiladora program, which provides a trade free zone, Mexico allows most equipment and materials imported into the country for assembly or manufacturing to be tax-free; this keeps production costs down and encourages manufacturing production within its borders.