In 2019, year over year exports from the aerospace manufacturing in Mexico sector grew by 10 percent over the prior year. A total of US 80.7% of the industry’s production was consumed by customers in the United States.
Over the last twenty years, Mexico has become one of the most prominent players in the global aerospace industry. Aerospace manufacturing in Mexico now produces everything from engines, to cargo doors, fuselages, engine parts, landing gear assemblies, connection systems and a myriad of other components that are essential for an aircraft to function.
At the end of 2019, Luis Lizcano, managing director of the Mexican Federation of Aerospace Industry (FEMIA), which brings together firms in the aerospace industry in Mexico such as Airbus, Bombardier, General Electric, Honeywell, as well as other large and small suppliers, reported that Mexican aircraft industry manufacturing exports totaled approximately US $9.5 billion.”
Lizcano maintained that “although most of the global aerospace industry is geared toward military use, aerospace manufacturing in Mexico is, for the most part, for the commercial, civilian sector. There is potential for great growth in this segment of the market.”
In the last 15 years exports derived form aerospace manufacturing in Mexico grew at a rate of approximately 14.4% per annum. In great part, this figure was achieved largely due to the arrival of large international companies such as Airbus, Bombardier, Safran, Groupe Latécoère and General Electric. In Lizcano’s view, Mexico has played an important role in the global aerospace manufacturing sector because production costs in the country, particularly labor, are lower than those found in other prominent aerospace manufacturing countries such as France and Canada. In addition to low costs, the five regions with the most aerospace manufacturing in Mexico activity are in those states that have implemented university and technical education programs that are aimed at developing students for employment in the nation’s aerospace industry. The states of Baja California, Chihuahua, Querétaro and Sonora are the four entities with largest number of established companies that manufacture some component of an aircraft for domestic and international companies.
Room for the Industry to Grow
Although Mexico ranks prominently in 12th place in terms of global aerospace industry volume of production, there are still opportunities for aerospace manufacturing in Mexico to grow. Industry watchers expect that, within the next few years exports will double to reach a total of US $19 billion per year. These forecasts are based upon projected orders from Airbus and Boeing. These two companies anticipate that in the next two decades it will be necessary for the industry to produce between 40-44 thousand new aircrafts. This estimate represents a doubling of the global fleet currently in operation.
Aerospace Manufacturing in Mexico is advanced in the Baja California cluster
Foreign investment in the Baja California aerospace industry has been steadily accumulating for more than five decades. Because the state of the industry is advanced in the Baja cluster, companies in this Mexican state are seeking to generate their own home-grown technology in order to motivate entrepreneurs to set up operations in the entity. In order to achieve this, the Baja California Aerospace Cluster organization has joined forces with Mexico’s National Chamber of Electronics Industry, Telecommunications and Information Technologies (Canieti) for the purpose of stimulating innovation, shared knowledge and entrepreneurship in this important industrial sector of the Baja California economy.
In a further effort to strengthen the presence of aerospace manufacturing in Mexico, the Baja California Aerospace Cluster also has entered into partnership agreements with all of the state’s engineering schools. The organization works hand in hand with teachers, their laboratories, and with students for the purpose of developing the human resources that are critical to maintaining the health of the aerospace industry in Baja California.
Currently, the aerospace industry ecosystem that exists in Baja California is comprised of approximately 250 companies. The aerospace manufacturing in Mexico that these firms engage in produces parts and components for commercial aircraft, as well as for drones and satellites. In addition to manufacturing, there are firms in the state that are dedicated to the repair and maintenance
Aerospace industry growth in Chihuahua continues
The state of Chihuahua’s aerospace sector plays a key role in the context of the national industry. This is because it is home to 25% of the country’s aerospace manufacturing plants. According to the Intelligence Unit of the British newspaper the Financial Times, the state has, in recent years, been among the top ten recipients of foreign direct investment in the aerospace industry due to the quality of its investment attraction strategy and the cost competitiveness that it offers.
The aerospace cluster in Chihuahua is one of the states largest source of manufacturing employment. Since 2008, it has generated more than 17 thousand jobs, and currently exports more than US $1.5 billion dollars of components and parts annually. Additionally, in the years from 2013 and 2018 Chihuahua was second only to Baja California in the receipt of foreign direct investment in the aerospace sector. During this period the state contributed US $331 million in investment to aerospace manufacturing in Mexico.
Companies that are active in Chihuahua’s aerospace cluster are mainly involved in five activities. They include certification, design and engineering, supply, manufacturing, as well as maintenance and repair. Products manufactured by the cluster’s companies include fuselages, aerostructures, motors, electrical wiring systems, high-precision machining, interiors and seats, among others.
The state of Queretaro accounts for 45% of Foreign Direct Investment in Aerospace Manufacturing in Mexico
The Mexican state of Querétaro is located in the central Bajío Region of the country. Over the last ten years, the area has been the largest recipient of foreign direct investment (FDI) inflows into the country’s vibrant aerospace sector. According to many experts, he recent receipt of 45% of FDI in this industry has made Querétaro the nation’s most important aerospace location.
Querétaro’s aerospace industry cluster currently consists of 85 companies that, when taken together, generate more than 8 thousand jobs for the local workforce. Among the items produced in this city are fuselages, landing gear assemblies, stabilizers, insulators and turbines. Querétaro ranks fourth nationally in the export of aircraft parts and is the most prolific importer of aeroparts used in manufacturing. Purchases of these items total US $24 million.
In addition to the prominent position that Querétaro has achieved in aerospace manufacturing in Mexico, it has also taken the lead in the area of industry education. The Universidad Aeronáutica en Querétaro was proposed in mid-2005 by the Government of the State of Querétaro with support from the Mexican National Government.
The foundation of the Universidad Aeronáutica en Querétaro, in great part, was associated with state’s successful effort to attract the Canadian aerospace company, Bombardier, to the entity. In addition to Bombardier, it was the opinion of the founders of the university that the academic institution would incentivize other Tier 1 and Tier 2 suppliers to the global aerospace industry to establish operations in the entity. Among the courses of study that students can pursue at the Universidad Aeronáutica en Querétaro are Aeronautical Engineering in Manufacturing and Engineering in Aeronautical Mechanical Design. Students can also receive technical training in avionics and aeronautical maintenance in Querétaro.
Sonora is the Engine of Aerospace Manufacturing in Mexico
The state of Sonora has the supply chain in place for the total manufacture of aircraft. It has casting, machining and secondary processes, as well as aerostructures manufacturing and assembly capabilities. Additionally, firms with facilities in Sonora manufacturer wire harnesses for aircraft and doors.
The sector has experienced sustained growth in the Sonora since the early 2000s and, since that time, has been successful in developing a technically skilled workforce that can meet the industry’s requirements and challenges. Production in Sonora has differentiated itself from other aerospace manufacturing in Mexico by specializing in the manufacture of turbines and other jet engine parts. There are currently 62 aerospace parts manufacturers located in the state.
Within the state of Sonora, aerospace industry manufacturers have a presence in several cities. Among them are Nogales, Agua Prieta, Hermosillo, Guaymas and Empalme, and Ciudad Obregon. The development of knowledge and skills over the past decade has enabled Sonora to leverage its human resources talent to become a leading competitor for international aerospace investment in Mexico. As 2015, over 10,500 people of various skill levels worked in Sonora’s aerospace industry and 29,203 students were enrolled in Sonoran engineering and technology programs. With an established aeronautical background and a growing engineering pipeline, Sonora is gearing up for technology advancements in the aerospace manufacturing sector.
A sampling of the companies involved in aerospace manufacturing in Mexico in the state of Sonora include Paradigm Precision, Sargent Aerospace and Defense, Benchmark, GS Precision, Cadence Aerospace , Acra Aerospace, Ellison Surface Technologies, Honeywell, Ducommun Aerostructures, BE Aerospace, Pinnacle Aerospace, Curtiss Wright, Parker Hannifin, Arrow Electronics, JJ Churchill, Bodycote, Rolls Royce, BAE Systems, Latecoere, Daher Socata, Radiall, Latelec and Bosch. Additionally, the state of Sonora is home to a GE Aviation plant which represents a foreign direct investment of US $400 million. The facility is located in Hermosillo, the capitol of the state of Sonora.
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