Due to the proximity of Mexico to the United States, various US companies are transferring part of their production to third parties located in Mexico, to reduce costs and solve logistics problems caused by long distances.

This is how nearshoring is promoting various industrial projects in Mexico, according to JLL's Project and Development Management area.

The production of these companies is mostly exported to the US, where assembly and final sale take place. It should be noted that according to estimates by the Inter-American Development Bank (IDB), nearshoring could increase global exports from Latin America and the Caribbean by 78 billion dollars (mdd) each year. Of this figure, 35 thousand 300 million correspond to Mexico (45%).

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"Mexico has a strategic location in terms of industry and this must be used well, even more so within the context in which we live, in which international transport logistics has been seriously affected and quick solutions need to be found," said Arturo. Bañuelos, Executive Director of Projects and Developments at JLL.

One of the sectors that has benefited most from nearshoring has been the automotive industry, indicated René Morlet, director of Industrial Projects for the area, and that another of the attractive factors for the arrival of industrial investments in Mexico has been the T-MEC, an international treaty that allows the integration of companies in the economic bloc of North America.

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He highlighted that the auto parts industry in Mexico was positioned as the main recipient of investments due to nearshoring, with 37% of the total amount raised in capital or relocation of plants, during 2022; while, by country of origin, 40% of this relocation came from China, according to data from the automotive sector.

Finally, Bañuelos said in a statement that some of the main factors that are favoring nearshoring between Mexico and the US are T-MEC, geographic proximity, low labor costs in Mexico, as well as existing supply chains that have proven to be fast and safe.

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Original note