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U.S. Trades China for Mexico

12 September, 2012

According to a report from CNN Money,Mexico has defeated China as the #1 place to manufacturing assembly products bound for the United States. Mexico is becoming so much more attractive that even Chinese companies are moving to Mexico to take advantage of NAFTA benefits when exporting to the U.S.

It makes sense. Mexico offers better access to the U.S. with faster,shorter and cheaper transportation routes as apposed to shipping products thousands of miles by ship across the Pacific as is the case when manufacturing in China. Many of these manufacturing companies moving to Mexico are actually owned and operated by U.S. companies. They bring their own equipment,pay for training,assembly,and labor in pesos which makes their dollar go farther.

Mexico has also become the lowest cost supplier to the U.S.,stealing the spot from China last year who is followed by India. Manufacturing in Mexico costs only 68%,India 73%,China 86% and Brazil 91% versus manufacturing in the United States. 

For many American manufacturers,China seems to have lost it’s sex appeal and Mexico appears to have found theirs.

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