Critical Logistical Considerations for Manufacturing in Mexico

Favorable logistics is one of the key reasons U.S. manufacturers continue to expand production to Mexico. Even when importing components from other global regions, including Asia and Europe, Mexico’s port access and free trade networks help to keep production moving and costs competitive.

Here’s a look at critical logistical factors that make shelter services manufacturing in Mexico a unique opportunity and put operators in a good position to succeed:

Same-Day Delivery

When operating along the U.S./Mexico border, finished goods being exported to the U.S. from Mexico often follow same-day delivery times with labels and packaging similar to shipping in the U.S., which is an attractive benefit to U.S. firms that are on strict timelines.

Regional Site Selection

The U.S/Mexico border region is highly competitive, though lucrative, for site selection as there are several established manufacturing hubs servicing various sectors, including automotive, aerospace, medical device, and electronics manufacturing.

Some manufacturers choose to set up in central Mexico, which is typically better suited for manufacturing and selling within the Mexican market. Either way, working with a local shelter services company can help narrow down which area is best based on budget, production type, and growth goals.

Global Free Trade Agreements

Mexico has been a catalyst for the expansion of global manufacturing. This is partially due to a wide range of free trade agreements Mexico has with several countries, including the USMCA, which provides incentives and protections within the United States, Mexico, and Canada trade bloc.

When combined with lower costs, a skilled workforce, and high-quality goods, among other benefits, Mexico creates opportunities for U.S. manufacturers to stay competitive while keeping production close by.

Multiple Ports and Borders

The Port of Long Beach to the Port of Ensenada is the closest connector for manufacturers bringing raw goods from Asia and Europe.

When traveling from the West Coast to the East Coast, the average transit time is five days, a significant time savings compared to overseas shipments from China to the U.S., which can take several weeks to arrive.

Familiar Infrastructure

A critical component for U.S. companies implementing shelter services manufacturing in Mexico is the similarity in supply chains and logistics they’re familiar with. The difference is in the customs process.

A shelter partner closely assists manufacturers when it comes to rules and regulations necessary to maintain compliance. This involves navigating Mexico’s IMMEX program and VAT certification approval process, a requirement for operators manufacturing in Mexico, and saves them 16% VAT on all temporarily imported goods, materials, and equipment used for production.

Enlisting a Shelter Services Company in Mexico

Transitioning production to Mexico is made easier with the support of a shelter company. With a team of local experts handling all administrative and compliance responsibilities required to launch production, manufacturers can focus on processes to get up and running as quickly as possible.

If you’ve been considering manufacturing in Mexico, contact IVEMSA and see if the move is right for your business.