MEXICO AEROSPACE 2016 - Aerospace - Clusters - Original Equipment Manufacturers Tiers Ones - Sub-Tier Suppliers - MROs - Education - Global ...
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
MEXICO AEROSPACE
2016
Aerospace - Clusters - Original Equipment Manufacturers
Tiers Ones - Sub-Tier Suppliers - MROs - Education
Dear Reader, The dynamics of growth and development of the Mexican Aerospace Industry, has placed our country on track to become an international leader of this industry. Mexico has forged its advantages building the future to establish itself as a center for advanced manufacturing, engineering, design and development of strategic value added for the Global Aerospace Industry. From a national perspective this sector is considered strategic for its growth potential, its contribution to technological development, competitiveness and its high sophistication in their exports, that reached 6,686 million dollars in 2015, a 5% increase from the previous year. The growth of the Mexican Aerospace Industry has been unprecedented, especially during the last twelve years that have seen a compounded annual growth rate of nearly 20% in exports, climbing from around 60 companies to more than 300 companies and support entities that currently make up this sector, NADCAP and AS9100 certified employing over 45,000 high-level professionals. ProMéxico as part of the next stage of development of the aerospace and defense industry in Mexico, defined the need to establish regional strategies to identify and drive the development of productive advantages for the aerospace clusters in the country. These strategies seek the development of poles of competitiveness; ie: innovation ecosystems and high-level coordination to raise the competitiveness of all regions, harmoniously combining different sectors, encouraging innovation, efficiently using resources, increasing collaboration, productivity and competition. By promoting competitiveness clusters, companies will have advantages in terms of access to a broader supplier base, specialized support services, sources of talent, access to knowledge, technologies, human resources and markets among others, attracting similar and complementary companies. In addition to local benefits, the said poles facilitate the efficient integration into production with strong national and international innovation networks. Under this criteria, this report will allow us to continue this strategy and support the development of the sector. We invite you to take the time to read through this work and learn about the Competitive and Strategic Mexican Aerospace Industry. Francisco N. González Díaz Benito Gritzewsky K. CEO Chairman ProMéxico FEMIA
CONTENT
Baja Exclusive
Synergy through diversity: An Introduction 69. Interview with Centro de Investigacion en 120. Interview with Bombardier Mexico
Interviews
to Mexico’s Five Main Aerospace Clusters
9. Interview with ProMéxico
Materiales Avanzados (CIMAV)
70. Crosschecking Collaboration and Innovation,
Zodiac Aerospace, SOISA Aerospace
122. Interview with Safran Group
123. Interview with ITP Querétaro
124. Interview with TechOps Mexico
California Leaders from both the private and public sector
10. Interview with Mexican Federation of and Universidad de la Salle work together in 125. Interview with Aeronautical University of delve into the nuances and nascent developments % of Tot
al Respo
nd
Aerospace Industries (FEMIA) designing aircraft seats Querétaro (UNAQ) that are shaping the industry. ESSES
LACK
ING IN
MEXIC
O
Weldin
g
71. Interview with SOISA Aerospace 126. Interview with General Electric
PROC
11. Introducing Mexico’s Aerospace Industry Tooling
72. Interview with Parque en Innovation Infrastructure Querétaro (GEIQ)
ign
14. Interview with Ernst & Young
re des
Softwa
tion
9, 18, 26, 41, 60, 71 and many more
fabrica
Universidad La Salle Chihuahua (ULSA) 127. Making Primes Feel at Home, Building
metal
Sheet
15. Interview with Goodrich, Riquelme y
MR O
R&O /
73. Supply Chain Status, Working to Fill the Gaps Querétaro’s Local Supply Chain
rs
Asociados
tributo
teri als dis
Raw ma
(ND T)
74. Interview with Wesco Aircraft Chihuahua 128. Interview with Especialistas en Turbopartes
testing
16. Aerospace Survey Data Analysis
tive
estruc
Non-d ns
injectio
plastic
lding and
75. Interview with Palomino High Precision 129. Interview with RYMSA
Mo
18. Interview with Bancomext
ser vices
calibration
ogy and
Metrol ducting
Machining 130. Interview with HYRSA Aerospace
ing and
19. Interview with Mexicana MRO Services
tub
act uring of
Manuf tings
g of cas
acturin
76. Interview with Intermex Industrial Parks 131. Interview with TechFab Inc. Mexico
Manuf
lants,
ls, sea
g of sea mers
acturin elasto
Editorial
Manuf ers and
Chihuahua
77. Escalating Capabilities, Aerostructures, 132. Interview with Aeroprocess TTT
fasten
ning
C machi
Baja California: An Aerospace Community CTOR
S,
cis ion / CN
HER SE INDUSTRY Pre
Machining and Beyond 133. Interview with Omni-X MX
s,
ISON
TO OT
SPAC
E
OWTH com ponent
MPAR AERO IC GR nic nics
IN CO PING THE E ECONOM electro mecha
act uring of ele ctro
LO ses,
50 Years in the Making
DEVE R TH Manuf
AL FO harnes
78. Interview with Fokker Aerostructures Mexico 134. It’s there if you know where to look, Testing
IS CRITIC N tment
Content
Heat trea
RE GIO
OF MY
g
Forgin
79. Interview with Tighitco Aerostructures and Quality-Control in Querétaro n proces
ses
22. An Introduction to Baja California
tributio
Fluid dis
Chihuahua 135. Interview with Tecnica Test
tia,
orks, Ca
Solidw
g with Autocad
25. Interview with Secretariat of Economic
workin AM and
centers CAD-C
Design
80. Interview with L3 Crestview Aerospace 136. Interview with Helmut Fischer
ite
compos
ss and
fibergla
Development (SEDECO), Baja California
ent of tings
Global Business Reports’ journalists provide
vel opm
De and coa
Chihuahua Operations 138. Interview with Testia Group, NDT Expert
%
cesses
21 ical pro
Chem
26. Interview with Aerospace Cluster of Baja
64
on-the-ground analysis of the trends that are
9
ly agree
81. Interview with Metal Finishing Co. Mexico
Strong 6 DEL
LIX MO IA,
Agree IPLE HE
California
EM
ee
Disagr disagree THE TR EEN ACAD
shaping Mexico’s aerospace industry.
U THINK BETW
Chihuahua (MFCO) 139. Interview with Intertek
ly ) IS
Strong DO YO BORATION MENT
OULD VERN
NT SH (COLLA Y AND GO STATE?
27. Interview with Gulfstream Aerospace Corp.
RNME INDUS
TR YOUR
GOVE E IN
TATE ORT IN TIV
82. Targeted Education and the Future of
CAL/S R SUPP SUPPLY CH
AIN EFFEC
THE LO GREATE L
IDE LOCA
PROV PING THE
Mexicali
LO
DEVE
Chihuahua’s Aerospace Industry Sonora: Revving Up its Edge in Engines
28. Interview with Honeywell Aerospace
Mexicali and Technology Center
83. Interview with Parque Tecnologico Chihuahua 11, 22, 23, 34, 56, 65, 77, 82
84. Interview with Universidad Tecnologica de 142. In Rare Air, Sonora Powers Aerospace in
29. Interview with GKN Engine Systems, Chihuahua (UTCH) Mexico
and many more
Mexicali
Nuevo
%
Yes d
33.3 of respon b
85. Interview with CENALTEC
No
51.5 75.8% assem
144. Interview with The Offshore Group
9.1
30. Interview with Hutchinson Aerospace and
ly agree
Strong 6.1
86. Interview with Universidad Politecnica de
Agree
146. Interview with Ducommun Inc.
Mexicali ee
Disagr disagree
Industry, Mexico
ly
Strong
Chihuahua (UPCH)
León
31. Interview with Innocentro LLC 147. Interview with St. Clair Technologies BAJA SONORA
Quantitative
CALIFORNIA CHIHUAHUA
87. Interview with Colegio del Aeronautico 148. Interview with Ellison Surface Technologies
Hermosillo
32. Interview with CETYS University
Chihuahua
(CAAMEX)
COAHUILA
34. Developing Baja California’s Local Supply 149. Interview with Latecoere International Inc. NUEVO
Data and Maps
La Laguna LEÓN
Chain
BAJA
CALIFORNIA Region Monterrey
SUR Torreón Saltillo
DURANGO
Gómez
Nuevo Leon: Monterrey’s Industrial
Culiacán Palacio TAMAULIPAS
36. Interview with Eaton Aerospace La Laguna: The Creation of a Needed Hub
La Paz Durango ZACATECAS
Ciudad
SINALOA Victoria
SAN LUIS
POTOSÍ
37. Interview with GKN Aerospace Engine Excellence Applied to Aircrafts
Zacatecas
San Luis
of Local Players
Potosí
NAYARIT 1 Mér
Aguascalientes
YUCA
QUERÉTARO VERACRUZ
Systems, Mexicali
Tepic
Guanajuato
Querétaro
Quantitative data help readers better understand
3 Campeche
4 Pachuca
Guadalajara
5
90. An Introduction to Monterrey’s Aerospace
Mexico City 7
JALISCO Jalapa C
38. Interview with Benchmark Electronics Inc. 152. Immense Potential, La Laguna’s Pioneering
Morelia Tlaxcala
2 CAMPECHE
the position of Mexico, especially relative to its
Colima Toluca TABASCO
MICHOACÁN Puebla Villahermosa
Cuernavaca 6
Industry
COLIMA PUEBLA
39. Interview with Skyworks Solutions de Mexico Aerospace Cluster
Chilpancingo
global competitors.
Tuxtla
GUERRERO Oaxaca Gutiérrez
93. Interview with Secretariat of Economic
OAXACA
154. Interview with Habilitaciones y Servicios
CHIAPAS
40. Interview with Orcon Corp., Ensenada
41. Interview with Bazz Houston Co. Development of Nuevo Leon (SEDEC) Industriales (HASEIN)
42. Interview with MTI de Baja Inc. 94. Interview with Monterrey Aerocluster 155. Interview with Deltaplast Mexico
43. Interview with American Autoclave Co. 95. Interview with FRISA 156. Interview with Equipos Inoxidables del 8, 13, 16, 23, 153
Querétaro
44. Interview with BAP Aerospace de Mexico, A 96. Interview with HEMAQ Norte (ACV Group)
1. AGUASCALIENTES
2. DISTRITO FEDERAL
97. Interview with Noranco, Monterrey Division
3. GUANAJUATO
Barry Avenue Plating Co. 157. Interview with Industrial B&S de México
4. HIDALGO
5. STATE OF MEXICO
6. MORELOS
98. Interview with Viakable
7. TLAXCALA
45. Interview with Allied Tools & Die 158. Interview with Intelligent Sourcing Solutions 0 100 200 300 Km
46. Interview with Anodimex de Mexico 99. Interview with Katcon (ISS)
47. Interview with Platinadora Baja 100. Interview with Jaiter 159. Interview with Kimball Solutions
48. Interview with MAIS Industry/SINCO
49. Interview with Coast Aluminium
101. Interview with Tecnologia Procesos y
Maquinados (TECMAQ)
160. Interview with Kirbymex
161. Interview with Siete Leguas Supply
Chain
50. Interview with Ryerson 102. Interview with Maquinados Industriales
51. Interview with Electro-Mech Components Mitras (MIMSA) Conclusion: Mexico Staking its Claim in the
52. Interview with IVEMSA 103. Interview with Dynamic Logistics
104. Interview with Grupo Forem
Global Aerospace Industry
53. Interview with Tijuana Economic Over 300 players are now operating in
Development Corp. 105. Interview with Asesoria y Equipos de
164. Expert Opinion Article: Human Capital Mexico’s aerospace manufacturing sector. GBR
Inspeccion (AEISA)
Trends in the Aerospace Sector goes in-depth to describe how gaps are currently
106. Interview with Mexico Aerospace Americas,
165. Interview with Transtelco
Sonora
Chihuahua: A World-Class Hub More being filled across the country’s supply chain to
Exova
Deserving of the Spotlight 167. Made with Precision and Intent, The Future support original equipment manufacturers.
107. Interview with Tecnologico de Monterrey
of Mexico’s Aerospace Industry 34-161
108. Interview with the Autonomous University
56. Introducing the Aerospace Industry in 168. Company Directory
of Nuevo Leon (UANL)
Chihuahua 178. Credits
110. The Aerospace Aftermarket, Monterrey’s
58. Interview with Secretariat of Economy, MROs
Chihuahua State Government 111. Interview with Monterrey Jet Center
59. Interview with Aerospace Cluster Chihuahua, 112. Interview with Avihel
Mexico
60. Interview with American Industries
61. Interview with Safran Labinal Power
113. Interview with Grupo Lomex
Future
Outlook
Chihuahua Querétaro: An Emerging Aerospace This research has been conducted by Gabrielle Morin, James Hogan,
Ty Jeevaratnam, Meredith Veit, Josie Perez, Juan Pablo Buerba,
62. Interview with Textron International Mexico Powerhouse Agostina Da Cunha, and Mungo Smith.
63. Interview with Zodiac Aerospace Equipo de
Mexico 116. Introducing the Aerospace Industry in Edited by Mungo Smith
Aerospace is at the cutting edge of technology
La Laguna
Graphic design by Gonzalo Da Cunha
64. Interview with EZ Air Interior Ltd. Querétaro and design. Mexico is establishing itself as a
65. Building Through Collaboration 118. Interview with Secretariat of Sustainable A Global Business Reports Publication
global manufacturing player and leaders share
Development (SEDESU), State of Querétaro
For updated industry news from our on-the-ground teams
67. Interview with Altaser Aerospace around the world, please visit our website at gbreports.com, their visions on the future of the industry.
68. Interview with Fablab International 119. Interview with Airbus Helicopters Site, subscribe to our newsletter by signing up to our VIP list
Technology Querétaro through our website, or follow us on Twitter: @GBReports
162-167
MEXICO AEROSPACE 2016
GBR • Industry Explorations • MEXICO AEROSPACE 2016
SYNERGY
THROUGH
DIVERSITY:
AN
INTRODUCTION
TO MEXICO'S
FIVE MAIN
AEROSPACE
CLUSTERS
“In 2005 there were 61 aerospace companies established in
Mexico. Today, one decade later, more than 300 companies
and agencies make up the sector. The consolidation of Mexico
as an important investment destination and as a platform for
development in this industry has been possible thanks to the
efforts of our triple propeller: government, academia and
industry.”
- Francisco N. González Díaz,
CEO,
ProMéxico
Image: Zodiac Aerospace
MEXICO
Global Business Reports INTERVIEW
Mexicali
Mexico has the second largest population
BAJA
and third largest land area in Latin America CALIFORNIA SONORA tion proposed since its inception, including Major international companies like Bombar-
and is situated to the south of the United Hermosillo
a prospective analysis of global trends in dier, Safran Group, GE, Honeywell and Eu-
G
ul
States, with which it shares a 3,200-km aerospace and defense, with particular em- rocopter have found in Mexico the conditions
Chihuahua
f
of
CHIHUAHUA
(1,900-mile). Since the implementation of COAHUILA
phasis on the implications for Mexico. Fi- to develop design and engineering centers,
Ca
the North American Free Trade Agreement nally, points are the regional strategies of the laboratories and production lines capable of
lif
in 1994, the U.S. and Mexican economies main aerospace cluster in the country are. evolving quickly to handle more complex
or
Monterrey
ni
Saltillo
have grown at similar rates and patterns. In The results collected in this publication have assignments in the race for next generation
a
NUEVO
LEÓN
2014, over 80% of Mexican exports were Gulf materialized from the proposals of the first engines and airframe components. This has
of
destined for the United States. According Mexico versions of the PVN. As may be noted, it has been possible due to the wealth and avail-
to the Congressional Research Service, been shown how various actors can coordi- ability of specialized human capital. Mexico
QUERÉTARO
Querétaro
Mexican exports to the United States from Mexico City
nate the Mexican aerospace industry in or- is the most important talent pool in America,
$39.9 billion in 1993 to $280.5 billion in der to trigger their growth and increase their with more than 100,000 graduates per year
2013. Since assuming office in December North added value. from engineering and technology courses. In
2012, the Mexican President, Enrique Peña This year we celebrated together the first addition to new graduates, Mexico has highly
Pacific
Ocean
Nieto has passed a series of reforms in edu- Mexican Aerospace Fair, which was at- qualified personnel with decades of experi-
cation, telecommunications, tax reforms, tended by 190 companies from 11 different ence in the automotive, electronics, medical
and most notably energy, which had been countries. The success of this first edition devices and advanced manufacturing-related
Francisco N.
0 100 200 300 Km
nationalized since 1938. confirms the strength of the Mexican aero- industries. The overall quality of infrastruc-
space sector around the globe. Our country ture has also played a major role in creating
MEXICAN GROWTH VS. INFLATION, 2008 TO 2017
Source: International Monetary Fund
González Díaz reaches higher altitudes every day. Proof of
this are the results obtained in the last years
favorable conditions with the availability of
laboratories, certification units and the pres-
GROWTH % INFLATION %
in the aerospace sector and its growing suc- ence of Mexican civil aviation authorities.
6 6 cess. Today, as never before, Mexico flies This facilitated the signing of the Bilateral
5 5
high and with wings of its own. Aviation Safety Agreement (BASA) with the
United States Federal Aviation Administra-
4 4
3 3
2 2
CEO Can you talk about some of the main qual- tion, which involves the recognition by the
1 1 PROMÉXICO ities Mexico offers today to encourage in- United States government of aeronautical
0 0
ternational investment into the aerospace certification systems and products made in
industry? Mexico. This allows components to be de-
-1 -1
-2 -2
MEXICO AT A GLANCE
Source: CIA World Factbook
-3 -3 Mexico is a country that is flying high in the signed and manufactured in the country and
-4
FORECAST
-4 aerospace industry. This is possible thanks encourages the development and strength-
Population: 121,736,809 (July 2015 est.) -5
2008 2009 2010 2011 2012 2013 2014 2015 2016 2016
-5
to our experience in high-tech sectors, our ening of national procurement for the parts
Land Area: 1,964,375 sq km
Official Language: Spanish proximity to the United States—the most manufacturing industry
Capital: Mexico City (Distrito Federal) important market in the world—our infra-
CURRENT ACCOUNT BALANCE ($ billions), 2008-2017
Chief of State: President Enrique Pena Nieto (since
Source: International Monetary Fund structure and major transport and logistics What initiatives does ProMéxico have to
December 2012)
Head of Government: President Enrique Pena Nieto Can you provide a brief overview of Pro- networks, having joined the Wassenaar Ar- accelerate the country’s ascent in the pro-
México’s role in the promotion of the rangement and, above all, our talent and hu- duction ladder?
0 0
(since December 2012)
-3 -3
Mexican aerospace industry? man capital. These competitive advantages In order to support the development of the
GDP (PPP): $2.22 trillion (2015 est.)
Growth Rate: 2.3% (2015 est.) -6 -6
GDP per Capita: $18,500 (2015 est.) -9 -9 The sustained growth of the Mexican aero- have enabled the operations of major aero- industry and to encourage innovation and the
GDP Composition by Sector: 3.5% agriculture, -12 -12
space industry is the result of the coordina- space companies in Mexico. Some relevant value-added activities, ProMexico is sup-
34.1% industry, 62.4% services (2015 est.)
tion of industry, academia, and government. figures demonstrate our success: at the be- porting this industry in two strategic areas:
-15 -15
Exports: $430.9 billion (2015 est.): manufactured -18 -18
goods, oil and oil products, silver, fruits, vegetables, -21 -21 This triple helix has built a collective vi- ginning of the 21st century, our aerospace developing exports and attracting foreign di-
coffee, cotton
Imports: $434.8 billion (2015 est.): metalworking
-24 -24 sion of the future of this sector, establish- exports were almost zero. In 2014 we ex- rect investment. In order to promote exports,
machines, steel mill products, agricultural machinery,
-27 -27
ing multiple actions to develop and promote ported over 6.3 billion dollars. Another fact ProMéxico organizes Mexican Pavilions
its competitiveness. From this vision, Pro- illustrates our growth: in 2005 there were 61 every year at the major international trade
-30 -30
electrical equipment, automobile parts for assembly FORECAST
-33 -33
and repair, aircraft, aircraft parts
Major Trade Partners: United States, China, Japan
2008 2009 2010 2011 2012 2013 2014 2015 2016 2016
México, in coordination with key industry aerospace companies established in Mexico. shows, buyer missions, business encounters,
players, created and orchestrated in 2010 a Today, more than 300 companies and agen- and otherevents. This year, a Mexican Pavil-
UNEMPLOYMENT RATE, 2008-2017 comprehensive plan called National Plan of cies make up the sector. The consolidation ion was installed at the International Paris
Source: International Monetary Fund Flight (PVN), which has been the basis for of Mexico as an important investment desti- Air Show at the Paris-Le Bourget Airport,
5.8 5.8
developing the national strategy of Mexican nation and as a platform for development in with a significant number of Mexican com-
5.6 5.6 aerospace (ProAero). The PVN is the point this industry has been possible thanks to the panies. ProMéxico held a seminar on issues
5.4 5.4 of reflection and assessment that refines the efforts of our triple propeller: government, of foreign investment with FEMIA at the first
5.2 5.2
strategy defined in the previous years, con- academia and industry. edition of the Aerospace Fair Mexico 2015,
sidering the developments and evaluating organized recently by the Mexican Air Force
5.0 5.0
4.8 4.8
4.6 4.6 results for its tactical and operational imple- Mexico’s aerospace industry has grown (FAM). Moreover, at the initiative of Boe-
4.4 4.4 mentation. 17.2% annually for the past nine years. ing, a seminar was organized under the First
4.2 4.2
Now in its fifth version, the PVN pres- Can you talk about some of the key driv- Forum of International Procurement that this
ents the result of projects and lines of ac- ers for his growth? aeronautical company held in Mexico. •
4.0 4.0
3.8 3.8
FORECAST
3.6 3.6
2008 2009 2010 2011 2012 2013 2014 2015 2016 2016
Industry Explorations -9- MEXICO AEROSPACE 2016
INTERVIEW Global Business Reports Global Business Reports EDITORIAL
INTRODUCING
Image: Safran Labinal
teract with agencies, various levels of gov- of the most important factors for the future
ernment in Mexico, and different clusters of the industry in Mexico.
and organizations like FEMIA globally to
share and develop relationships), and pro-
motion (we have a group that is in charge
Companies have identified a lack of
skilled labor. Has this also been identi-
MEXICO’S
of promoting the aerospace sector in Mex-
ico and internationally)
fied by FEMIA?
This is another example of the process that AEROSPACE
Can you talk about the efforts that
FEMIA are making to grow the local
Mexico is undergoing. To curtail this is-
sue, we are promoting technical level edu-
cational institutions in the areas which in-
INDUSTRY
network of small and medium-sized en- dustry has identified as lacking.
terprises (SMEs) supporting the aero-
space industry and ensuring that corpo- What are some of the areas for lobbying
rations have access to the supplies they that FEMIA is involved?
need? We are working with the Ministry of Econ-
FEMIA is currently developing and moni- omy in Mexico and ProMéxico to jointly
toring a system, which takes an invento- promote Mexico’s aerospace industry. We
Luis ry of the companies in the sector as well
as the kinds of skills and capabilities that
are promoting as one entity so we might
coordinate all of our efforts together to
Lizcano they possess, and matching them with the
requirements of other companies.
employ a more efficient and clear mes-
sage. Another example is the Mexican
Aerospace Show that we work jointly with
The aerospace industry in Mexico re- Mexico’s Air Force in order to promote
sembles an inverted pyramid, in that and organize, in which 250 exhibitors par-
there are many original equipment ticipated in the first year and for the 2017
General Director manufacturers but a shortage of local show expect close to 500 exhibitors. In the past decade, there has been more tralized around the capital, Chihuahua in Chihuahua. Though timelines are highly
MEXICAN FEDERATION OF suppliers. What is causing this and what aerospace-related foreign direct invest- City. In addition to housing five of the dependent on the industry, airplane paint-
AEROSPACE INDUSTRIES, A.C. is the solution? What is FEMIA’s strategy for achiev- ment in Mexico than in any other coun- seven original equipment manufactur- ing and parking centers are expected to be
(FEMIA) This inverted pyramid is not a long-term ing its goal of 400 foreign companies try in the world. According to Fernando ers (OEMs) in Mexico—Cessna, Beech- added to Chihuahua’s international airport
trend but a snapshot of the current land- in Mexico, and some of potential chal- González Díaz, CEO of ProMéxico, “the craft, Textron International, Honeywell by the end of 2016.
scape of aerospace in Mexico. The de- lenges? sustained growth of the Mexican aero- aerospace, and EZ Air Interior Ltd.—the Nuevo León is one of Mexico’s industrial
velopment of a supply chain is an ongo- FEMIA is very optimistic about the future, space industry is the result of coordinated state’s capabilities range from interiors, to hubs, and the city of Monterrey boasts a
ing process, and the aerospace sector in but we are aware of some of the challenges industry, academia and government jobs.” emergency evacuation systems, to aero- rich history in the steel, cement and glass
Mexico is fairly young. We have some we might encounter. The first one is to con- The continued development of the aero- structure assembly for aircraft and heli- industries. These markets are dominated
very important companies that are in Mex- solidate the integration of the supply chain space sector in Mexico has given rise to copters. The government is working to by large, family-owned Mexican compa-
Can you introduce FEMIA by providing ico and we recognize the need to develop as we see this as only a Mexican aerospace five distinct clusters: Baja California, implement a multifaceted maintenance, re- nies that in recent years have identified
a brief history of the association? the rest of the supply chain pyramid ade- industry market and would like to con- Chihuahua, Nuevo León, Querétaro, and pair and overhaul (MRO) plan, with hopes the opportunities offered by the aerospace
There has been a constant growth within quately –but this is all part of a process, solidate the supply chain as a platform for Sonora. After conducting seven months of of eventually having a final assembly plant industry and have undertaken a strategy of
the aerospace industry in Mexico. From within which we are trying to accelerate North America. The second challenge is research on the ground, this in-depth re-
2004 to 2014, we have been growing at an this progression through developing the to fulfill the human capital requirements port is a culmination of our findings across MEXICO AEROSPACE EXPORTS, 2004-2014 ($ millions)
average rate of 17% per year. This growth companies who have the proper skills to with the growth of the aerospace industry, these five these states, as well as an intro- Source: ProMéxico, via Ministry of Economy, DGIPAT, with data from DGCE-Banxico.
necessitated the emergence of some kind then grow the supply chain. And where which is why we work closely with aca- duction to Coahuila as an up-and-coming
$ MILLIONS
7,000 7,000
of association of aerospace companies. In technologies that are not available in Mex- demic institutions. Mexican aerospace destination. 6,500 6,500
2007, FEMIA was established under that ico are required we then invite companies Baja California’s aerospace cluster began 6,000 6,000
premise, and currently includes around 90 to operate in Mexico to supply the North Do you have a final message for the in- fifty years ago and has evolved into the
member companies. American market. ternational aerospace community? largest and most established aerospace
5,500 5,500
The first message is to Mexican compa- cluster in Mexico today. Its 80-plus aero- 5,000 5,000
Can you describe the organizational How does FEMIA link academia to in- nies who are looking to participate within space companies are spread between the 4,500 4,500
structure FEMIA and discuss some of dustry? the industry, and that is to engage in their clusters of Tijuana and Mexicali and the 4,000 4,000
the principle needs of the industry that We serve as the linkage point between ac- due diligence and learn about the indus- cities of Ensenada and Tecate. The state 3,500 3,500
it seeks to address? ademia and some companies, by actively try in order to understand what is neces- is home to companies such as Honeywell, 3,000 3,000
Comprised by a very small staff that sup- working to fill the gaps in academia identi- sary for them to achieve this goal. To the UTC, GKN and Eaton, with a clear focus 2,500 2,500
ports a board, we work under the following fied by companies’ requirements. For ex- international community, we want them to on electrical and electronic systems, en- 2,000 2,000
four pillars: competitiveness (supply chain ample we have a close relationship with get to know Mexico beyond the headlines. gine parts, assembly of interior and seats,
development), human capital development the Mexican Aerospace Education Coun- Mexico has much to offer to foreign com- control and navigation instruments, and
1,500 1,500
(working together with industry and aca- cil, which is an organization that groups panies that can benefit the growth of the engineering and design. 1,000 1,000
demic institutions to pursue new skilled some of the major educational institutions. aerospace industry in Mexico. • Contrastingly, Chihuahua’s aerospace 500 500
human capital), institutional relations (in- Furthermore, we recognize that this is one cluster is relatively new and highly cen- 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
MEXICO AEROSPACE 2016 - 10 - Industry Explorations Industry Explorations - 11 - MEXICO AEROSPACE 2016
EDITORIAL Global Business Reports Global Business Reports EDITORIAL
diversification. Today 80% of the compa- state is developing its specialties in parts California, the industry has reached a point
nies with operations in the aerospace in- for fuselage, landing gear, cables, har- where there are too few suppliers to absorb MEXICO'S FIVE MAIN
AEROSPACE CLUSTERS
dustry in Monterrey are Mexican-owned nesses and precision machining, and the continued growth and, as such, the state is + LA LAGUNA
companies. One exception is the state’s joint venture between AeroMéxico and facing an inverted pyramid problem. The
only OEM, Monterrey Aerospace, which Delta Airlines led to the 2014 inauguration Tijuana and Mexicali clusters in Baja Cali-
is a wholly owned subsidiary of MD He- of TechOps MRO—Latin America’s larg- fornia are focused on developing providers
licopters. Nuevo León has a specialization est MRO. The opening of the Aerospace of special processes such as heat-treatment
in metal mechanics and offers strong test- University in Querétaro (UNAQ) further and non-destructive testing, for which
ing capabilities through companies such burnishes Querétaro’s reputation of the contractors still look abroad. In Querétaro,
Mexicali
as Exova and Grupo Forem. Monterrey is strongest emerging cluster in Mexico. there is a lack of machine shops and ac-
also home to a competitive MRO market While Sonora is typically known for min- cess to raw materials. This report aims to
centered on the city’s private Aeropuerto ing as well as automotive manufacturing describe how the industry is overcoming
del Norte. The state government and the and other maquiladoras, the state’s tri-city the challenges of building a sustainable lo- BAJA
Monterrey Aerocluster hope to grow the aerospace cluster, comprised of Hermosil- cal supply chain, challenges that are rooted CALIFORNIA SONORA
CHIHUAHUA
aerospace sector by attracting a prime con- lo, Guaymas and Empalme, is helping to in the difficulty of certification, a lack of Hermosillo
tractor that would stand to gain the most shift the state’s industrial profile. Sonora qualified skilled labor, and restricted ac- Chihuahua
value from what Nuevo León can offer and is characterized by aerospace companies cess to capital. Towards the end of the COAHUILA
likewise bring the most value to the state. that are focused on precision machining, book, we have highlighted the special case
Querétaro’s aerospace sector, on the other electromechanical assembly and sophisti- of La Laguna, a region in northern Mexico
hand, also emerged recently in 2006 with cated processes. Still growing and work- that is developing local suppliers to solve NUEVO
the arrival of Bombardier. Today, the two ing through a lack of sufficient suppliers, some of the pressing issues listed above as BAJA
CALIFORNIA
La Laguna LEÓN
other major players in the state are Airbus Sonora nonetheless claims the title as the national concerns. SUR Region Monterrey
Helicopters and SAFRAN Group. The largest cluster of precision-machining and We would especially like to thank our DURANGO Torreón Saltillo
Culiacán Gómez
state’s 40-plus companies also include engine-component companies in Mexico. partners, ProMéxico and FEMIA, for their La Paz
Durango
Palacio
ZACATECAS TAMAULIPAS
a few international tier-one and tier-two The central focus of our research across continued support and show our gratitude SINALOA Ciudad
Victoria
companies, which are centered around the Mexico’s five aerospace clusters is on the to the local governments for their assis-
SAN LUIS
POTOSÍ
Zacatecas
state’s capital, Santiago de Querétaro. The development of the supply chain. In Baja tance throughout our project. • NAYARIT
San Luis
1 Potosí
Aguascalientes
Mérida
Tepic
Guanajuato QUERÉTARO VERACRUZ YUCATÁN
3 Querétaro
Guadalajara 4 Pachuca Campeche
JALISCO 5 QUINTANA
Morelia
Mexico City 7 Jalapa ROO
Colima 2 Tlaxcala Chetumal
MICHOACÁN Toluca
Puebla TABASCO CAMPECHE
COLIMA Cuernavaca 6
Villahermosa
Aerospace facts PUEBLA
Chilpancingo
$6,686
GUERRERO Oaxaca Tuxtla
Gutiérrez
OAXACA
CHIAPAS
million
EXPORTS DURING 2015
5%
GROWTH OVER 2014
$1,033 1.
2.
3.
4.
AGUASCALIENTES
DISTRITO FEDERAL
GUANAJUATO
HIDALGO
million 5.
6.
7.
STATE OF MEXICO
MORELOS
TLAXCALA
FAVORABLE BALANCE IN THE
TRADE BALANCE IN 2015 0 100 200 300 Km
Source: Proméxico
MEXICO AEROSPACE 2016 - 12 - Industry Explorations Industry Explorations - 13 - MEXICO AEROSPACE 2016
INTERVIEW Global Business Reports Global Business Reports INTERVIEW
VAT returns, global-trade compliance and You mentioned that employees are very odrich actively promotes foreign invest- paid. Additionally, Mexico offers the IM-
data analytics, which is crucial for efficient loyal, but what does the aerospace sec- ment in Mexico through conferences, pre- MEX program, which allows the importa-
lead times. tor believe the workforce lacks? sentations, and trade missions in Mexico tion of goods, machinery, and raw materi-
Mexico produces more engineers per cap- and abroad in collaboration with differ- als on a temporary basis, which are utilized
Can you provide us with an example of ita than the United States. This sounds im- ent public and private organizations such in production and then exported as a fin-
the type of work EY performs for aero- pressive, but it does not benefit the aero- LPD
as ProMéxico and the different European ished product.
space clients in Mexico? space industry and the oversupply floods Chambers of Commerce and Consulates.
One of EY’s clients is one of the biggest the marketplace, diminishing the return on While there is great potential for the in-
manufacturers in Chihuahua and it ex- the students’ engineering education. Most What services does Goodrich provide to dustry, what are the greatest obstacles
ports a significant amount of its produc- of the engineering graduates have a ‘desk’ the aerospace industry? that it still faces?
tion, meaning it has significant global- engineering degree, but the industry needs LPD: There are very high expectations for EDO: Aerospace is one of the most strate-
trade concerns. Nearly 100% of the raw technicians, which is less ‘chic’ and start- the aerospace industry to create exponential gic sectors for the country’s development.
materials, such as high-grade aluminum ing salaries are quite low. Understandably, EOL growth for the Mexican economy, as it is It is an industry for which Mexico offers
and metals, have to be imported as they students do not want to get a technician de- generating employment and incrementing significant competitive advantages and, at
are not produced in Mexico. As such, the gree. The irony is that given the short sup- technological capacities as well as trans- the same time, has a very positive poten-
process of importing raw materials for ply of technicians in Mexico, international forming the skills of the labor force. For tial impact on Mexico ́s economy. There
manufacture, and then exporting the final firms are willing to pay great money, as the firm, the aerospace industry represents are, however, some issues that must be ad-
Francisco product is not easy for the companies. EY
works closely with them to have the right
much as they pay their technicians in Eu-
rope or North America, in order to secure
Luis Pérez Delgado an important area of opportunity as this
sector may experience 5% to 15% growth
dressed in order for Mexico to successfully
climb the global rankings. These issues in-
Bautista systems in place that also comply with the professional technicians. & Elisa de la O during the next 10 years in the value chain clude the lack of coordination between op-
López
Mexican authorities. With regards to spe- of suppliers. Our firm has represented avia- erators and authorities, as some airports are
cialized taxation when operating a maqui- The industry will undoubtedly continue tion clients for several decades, granting overused and some are underused. Another
ladora, several issues arise that could have to grow in the years to come, but what us extensive experience advising clients in main issue is the lack of connectivity out of
implications on a company’s tax structure areas need to be address in order to investment, company acquisitions, capital- the airport through logistics’ infrastructure,
in Mexico, including ensuring that the op- achieve greater growth? izations, aircraft parts concessions and air- which affects the production-consuming-
Senior manager Global Trade erating model complies with permanent Aerospace in Mexico is still in its infancy. LPD: Senior Partner craft registration. However, our aerospace distribution nodes. Lastly, there is a lack
and Investment EDO: Lawyer
establishment exceptions, transfer pricing, We have significant players doing very practice group and full-service law firm of an adequate airport infrastructure in the
ERNST & YOUNG GOODRICH, RIQUELME Y
and human capital. specialized manufacturing. Mexico has yet may advice companies on the following main cities, which limits the possibility for
to see the rise of all the support industries ASOCIADOS services: intellectual property and protec- Mexico to establish itself as the main cen-
How do foreign aerospace companies that are necessary for these big companies, tion of patents, designs and technology de- ter of passenger and cargo connectivity for
evaluate opportunities in Mexico differ- like specialized recruiting firms or sourc- velopment, procedures before the general Latin America.
ently from foreign companies in other ing consultants for the aerospace industry, direction of civil aeronautics, labor advice,
industries? whereas in specialized countries there are tax and customs advice for the aerospace How would you evaluate the aerospace
The aerospace sector looks at investment firms dedicated 100% to these efforts. The industry, advice for maintenance, repair industry’s contribution to Mexico in
on a whole different spectrum than other same thing occurs in logistics and trans- and overhaul companies, and advice for terms of job creation and other relevant
We would like to start with a brief in- companies trying to enter the country. portation, which leads to the big compa- Can you provide us with a brief intro- original equipment aerospace manufactur- benchmarks?
troduction to the services that Ernst & Most investments in Mexico are created nies taking the burden of doing it them- duction into Goodrich, Riquelme & Aso- ers, just to name a few. LPD: The aerospace industry is a great
Young (EY) offers to the aerospace sec- with a strategy to reduce costs by taking selves. If Mexico wants to take a leading ciados (Goodrich)? source of specialized jobs and economic
tor in Mexico. advantage of the federal programs like ma- role, it should grow its support industries. LPD: Goodrich is one of the most presti- How have NAFTA and MEUFTA helped activities closely linked to the development
Ernst & Young (EY) has been in Mexi- quiladora, IMMEX, or VAT certification. Separately, the industry in Mexico has not gious, widely respected and innovative law to grow the aerospace industry in Mex- of new technologies and the advancement
co for over eighty years, serving several Aerospace, on the contrary, does not really done an adequate job promoting itself. The firms in Mexico City. From its inception ico? of Mexican manufacturing talent. The in-
aerospace clients through our four service consider those aspects until the very end. industry has been growing in the double in 1934, the firm has specialized in repre- EDO: The main impact derived from dustry in Mexico generates about 31,000
lines, which include tax, transaction-advi- The crucial points they focus on relates to digits for the last ten years and employs senting companies doing business in Mex- NAFTA and MEUFTA can be seen in the formal jobs, from which 64.5% are located
sory services, business advisory, and assur- operational elements, including the supply more than 40,000 people, yet it is still ico in all legal aspects at every level. The reduction of duties. With NAFTA, duties in the states of Baja California, Chihuahua,
ance services. The latter is mainly auditing chain and labor force. Mexico is not the Mexico’s best-kept secret. One could ar- vast majority of its clients are medium and that were approximately 15% to 20% are and Querétaro. The design of aircraft parts
services but as global chains become more cheapest workforce in the world; however, gue that this is because most of the long- large companies, some of which are in the now exempted with respect to import tax. and systems is an everyday-growing mar-
integrated it has become critical for com- companies do not focus solely on the hour- term contracts are negotiated at headquar- ‘Fortune 500’ category. As the firm has a Thanks to this benefit, it is enough for a ket, therefore innovation and the capabil-
panies to create strategies around the tax ly wage, but also on the productivity of the ters, while the operations are mainly here strong international orientation, a number company to be registered in the National ity of developing value-added products to
and administrative part, feasibility analy- worker. Aerospace companies are looking and they focus solely on quality and manu- of our attorneys have lived, trained, and are Importers’ Registry for it to obtain the cor- the aircraft production chain is without a
sis, supply-chain-network analysis, entry- more at the cost per piece, and not neces- facturing standards. Several large corpora- qualified to practice in other countries as responding NAFTA origin certificate to doubt a business opportunity around the
strategy models, site selection, business sarily the wage per hour, which is where tions that are looking to increase visibility well as being multilingual. Today the firm have right for exemption rates when im- globe, strategically positioning Mexico.
and financial case for new investments. Mexico excels. Furthermore, Mexican and brand awareness today have estab- has a professional and administrative staff porting parts, components, and raw materi- But, there is still a great deal of work to
Additionally, there is a vast amount of workers are extremely proud and loyal to lished corporate offices in Mexico like of approximately 200. Goodrich’s main als for the aerospace industry. As for parts, be carried out, especially considering that
products crossing borders that ends up be- their companies. It is no cliché that within Airbus group or Safran Group, but growth practice areas cover: aerospace, automo- with the MEUFTA certificate of origin, the according to the government’s Pro Aero
ing a heavy burden on companies if they the aerospace sector in Mexico, the suc- will increase even more once small and big tive and transportation in general, as well same are also exempted, being subject to 2012-2020 plan, Mexico is expected to in-
do not have the right expertise and systems cess of the company is derived from the players alike adopt a similar approach. • as corporate, mergers and acquisitions and the applicable rate is only MXN$300 for crease sales, which will bump up its global
in place. To support its clients EY´s team success of its employees, which is why commercial transactions, taxation, customs customs service per import declaration. In ranking from its current position at 15th
of experts assists with inventory tracking, companies are so protective of them. and trade regulation, and many more. Go- both cases, VAT (16%) on imports shall be place to 10th place. •
MEXICO AEROSPACE 2016 - 14 - Industry Explorations Industry Explorations - 15 - MEXICO AEROSPACE 2016
FACTSHEET Global Business Reports
PROCESSES LACKING IN MEXICO % of Total Respondants
Welding
Tooling
AEROSPACE Software design
SURVEY
Sheet metal fabrication
R&O / MRO
DATA Raw materials distributors
ANALYSIS Non-destructive testing (NDT)
Molding and plastic injections
Metrology and calibration services
Manufacturing of tubing and ducting
Manufacturing of castings
IN COMPARISON TO OTHER SECTORS, Manufacturing of seals, sealants,
DEVELOPING THE AEROSPACE INDUSTRY fasteners and elastomers
IS CRITICAL FOR THE ECONOMIC GROWTH
OF MY REGION Precision / CNC machining
Manufacturing of electronic components,
harnesses, electro mechanics
Heat treatment
Forging
Fluid distribution processes
Design centers working with Solidworks, Catia,
CAD-CAM and Autocad
%
Strongly agree 21 Development of fiberglass and composite
Agree 64
Disagree 9 Chemical processes and coatings
Strongly disagree 6 0% 10% 20% 30% 40% 50% 60%
THE LOCAL/STATE GOVERNMENT SHOULD DO YOU THINK THE TRIPLE HELIX MODEL DO YOU THINK THE TRIPLE HELIX MODEL
PROVIDE GREATER SUPPORT IN (COLLABORATION BETWEEN ACADEMIA, IS EFFECTIVE NATIONALLY
DEVELOPING THE LOCAL SUPPLY CHAIN INDUSTRY AND GOVERNMENT) IS
EFFECTIVE IN YOUR STATE?
% % %
Strongly agree 33.3 Yes 33.3 Yes 69.7
Agree 51.5 No 66.7 No 30.3
Disagree 9.1
75.8% of respondents agree that it is likely all aircraft parts will be
Strongly disagree 6.1
assembled in Mexico within the next ten years
MEXICO AEROSPACE 2016 - 16 - Industry Explorations
INTERVIEW Global Business Reports Global Business Reports INTERVIEW
through long-term leases. It is common for has grown in the last three years in terms Mexicana MRO Services was a part of How does Mexicana MRO plan to con-
foreign companies not to invest directly in of passenger numbers by over 10% to 13% Mexicana Airlines until it ceased its op- tinue to expand its domestic and interna-
infrastructure. The trend and aim of these per annum, translating into investments erations in 2010. Can you provide us tional footprint?
foreign original equipment manufacturers in fleet growth and modernization by all with an introduction to the company as a Mexicana MRO has a solid amount of na-
(OEMs) is to build their surroundings with Mexican airlines. The consumers have standalone entity and how it has fared in tional clients, but our main market is South
local suppliers and providers, and this ver- benefitted incrementally as the prices keep the last two years? America. Our eyes are set on European
EM
tical integration is precisely what Mexico dropping as a result of increased competi- Mexicana MRO Services was a part of leasing companies, which we increased
needs. Our primary goal as a development tion, which has created a real debate about Mexicana Airlines to provide maintenance from one to three this year. The goal is to bet
bank is not to directly finance OEMs and whether to travel by bus or plane. to its fleet, but beginning in 2007 it also heavily on consolidating business with the
tier-one companies, which usually come All these factors are driving growth, which sought opportunities as a third-party pro- Central and South American companies and
from Europe or the United States with translates to airlines renovating or chang- vider for other airlines. Today, Mexicana continue to scout the opportunities in the
cheaper credit from home or the interna- ing their fleet, which is a major trend MRO Services offers maintenance and United States in order to bring their ships
FLHU tional market financing in various stock seen mainly in Asia Pacific, China, and painting through its nine production lines, to Mexicana MRO. U.S. airlines can choose
exchanges, but to foment the development the Middle East, like Kuwait and Saudi two of which are dedicated to painting. Our from a massive supply of maintenance, re-
of the local tier-two and tier-three base of Arabia. OEMs currently have orders that hangar is flexible, allowing us to service pair and overhaul (MROs) companies, but
both domestic and foreign companies. are up to their capacity for the next eight wide and narrow bodies. Mexicana MRO the availability and cost of the skilled work-
EM: Bancomext also offers airlines struc- years, meaning that if a Mexican company had been struggling from grave financial force in Mexico, as well as our own efforts
Eduardo Muñíz tured financing so that they can purchase
ships and increase and modernize their
wants to buy a plane, it must buy it with
years in advance, and must solicit financ-
Marcos and economic times since its inception, but
through disciplinary action and stern deci-
to increase our certifications, will enhance
our chances, especially as our operations in-
& Federico fleet. Mexico's growth in aviation has ing from institutions like Bancomext in or-
Rosales Gómez sion making by the management team, the crease once we move into the new airport.
Antonio de la
become quite significant over the years, der to secure it. company was finally able to be audited in
showing very optimistic signs when com- Mexico, furthermore, has an even greater 2014 by PwC, with a quite positive and fa- What competitive advantages differenti-
Hoz
pared to the rest of the world, both in ex- opportunity not only in aviation but es- vorable outlook. Looking forward, 2015 ate Mexicana MRO from other MROs in
panding the fleet and remodeling and mod- pecially in the maintenance, repair and will be completely different to 2014, not in Mexico and the region?
ernizing the current fleet. overhaul sector, since Mexico becomes a a sense that 2014 was bad, but on the con- The Mexican market is small with only
hub for Latin America to North America Director General and CEO trary, the difference will come from the fact three main players, which give services to
EM: Director, Finance, Transport, How have shelter schemes been key for as well as the whole world, not to mention MEXICANA MRO SERVICES that there was no financial base of records. third parties, while Aeromexico and Inter-
Logistics and Aerospace
FHU: Head, Aerospace Sector the development of the aerospace sector the competitive cost of labor. Our initial calculations yielded that we had jet have their own shops. Today, we are the
BANCOMEXT in Mexico? 3.5 production lines per year, but in reality leader in market share, and have established
FHU: Mexico has a unique way of working What are the goals and vision for Ban- we are actually reaching 5.5 on average as three main factors that will help increase
with the big, international OEMs through comext with regards to the aerospace of 2015, which has given us a certain stabil- our market share. The first is the flexibility
shelter schemes. Shelter schemes can of- industry in Mexico? ity. Furthermore, client retention has been a to receive airlines, aided greatly by the en-
fer certain benefits for companies look- EM: Bancomext has very competitive fi- determining factor for our uphill climb, as gineering team that we inherited from Mex-
ing to invest into Mexico, like not need- nancing and one of our advantages is that we are favored by the national clients, and icana and allow the internal logistics to run
ing to make capital investments, nor hiring we can provide very long tenors, such as South American clients have stuck with us smoothly. The second is delivery time, and
Can you provide us with a brief intro- personnel, nor creating a legal company 25+ years, that are not usually found in and are actually growing, since we added the third is the number of certifications, of
duction into Bancomext? structure. On the contrary, these compa- the market. Bancomext wants to be an al- four more in 2015. which we have sixteen. •
EM: Bancomext is a development bank in nies connect with various commercial real ternative for the sector's financing and go
charge of fomenting and financing Mexi- estate developers who take care of topics hand-in-hand with the principal players in
can international trade, and is geared to- like finding the specialized technical per- aerospace as well as with the clusters with
wards serving the sectors that have signifi- sonnel, importing the raw materials, and the hope of integrating the value chain in
cant roles in the Mexican export market, all these types of processes, allowing the Mexico. The industry needs to keep devel-
including automotive, tourism, and indus- OEMs to focus on their operations while oping in order for employment to keep in-
trial real estate for the establishment of these sheltering companies take care of ad- creasing, and for Mexican players to rise
productive plants in Mexico. In addition, ministrative and legal aspects. Bancomext in the service sector of the aerospace in-
Bancomext focuses on clean-energy initia- helps finance these sheltering companies. dustry.
tives, the mining sector as well as logistics, Most of the companies that come here are
transportation and aerospace. Our main What opportunities does the aviation in- huge multinationals that are not only in-
goal is to ensure that there is a competitive dustry represent for Mexico? volved in aerospace, so we want to keep
and efficient logistics infrastructure for FHU: In Mexico, the aviation story is now attracting these companies, but also give
commerce in and out of Mexico. a modern and young one, whereas in Latin them the right framework to spread their
America only four airlines control around wings and delve into the other sectors
To what extent is Bancomext interested 60% of the market, in Mexico the market that can create employment and revenue
and involved in aerospace? has a large component of fairly new air- for Mexico. Other players will be needed
FHU: Bancomext’s involvement in aero- lines that started off as small niche players, as suppliers, which will eventually bring
space has been indirect, specifically by but have grown significantly and increased in technology and advance the Mexican
financing built-to-suit industrial parks and competition in the market. When compar- workforce and productivity. •
plants where aerospace companies operate ing Mexico with Latin America, Mexico
MEXICO AEROSPACE 2016 - 18 - Industry Explorations Industry Explorations - 19 - MEXICO AEROSPACE 2016GBR • Industry Explorations • MEXICO AEROSPACE 2016
BAJA
CALIFORNIA:
AN
AEROSPACE
COMMUNITY
50 YEARS IN
THE MAKING
“Biculturalism stemming from the United States and technical
support from such proximate relations has proven especially
conducive to continued investment and business in our state.”
- Tomas Sibaja,
Executive President,
The Aerospace Cluster of Baja California
Image: UTC Aerospace SystemsEDITORIAL Global Business Reports Global Business Reports EDITORIAL
AN INTRODUCTION
Mexico More than
TO BAJA CALIFORNIA companies and support organizations, generating about
Supplier of aircraft parts to the US jobs
Source: Proméxico Source: Proméxico
Baja California, the oldest and largest of Mexico’s aerospace hubs, The prevailing focus of the government is to develop a greater sources and communication. The only limitation is to cross the of the ‘Cali-Baja’ mega-region. However, through the strengthen-
is home to almost a third of the total number of aerospace compa- presence of small and medium-sized companies engaged in the physical border.” ing of links between industry, government and academia Tijuana
nies in Mexico. Located in the northeastern corner of the country, aerospace industry. Being able to offer more than just competitive labor rates is in and Mexicali have become competitive destinations not just for
the state’s major advantage is that it shares a border with the Unit- It is this Cali-Baja term that is one the most commonly cited important factor in attracting large players to the State. manufacturing, but also more value added and complex processes.
ed States, thus giving companies easier access to North American advantages of aerospace operations in the region. The so-called Gulfstream, a private jet OEM that is wholly owned by Gener-
suppliers. Quick access to major ports and border crossings are mega-region, comprising of Southern California, Baja California al Dynamics, began its manufacturing operation in Mexicali in
additional strengths. and to a certain extent Arizona, allows companies operating south 1983. Today, Gulfstream Mexicali employs over 1,600 people, a Design and Engineering in Baja California.
Baja California’s 80-plus aerospace companies are located around of the border to source supplies from the much more developed workforce double what it was ten years ago. “Gulfstream Mexi-
Tijuana and Mexicali, with smaller concentrations around the cit- and established U.S. aerospace sector while benefitting from the cali plays a significant role in the manufacturing process for Gulf- Despite the efforts of these international companies to undertake
ies of Ensenada and Tecate. With 50 years experience in the in- low-labor cost and tax incentives available in Mexico. With a good stream aircraft,” said John Ortega, vice president and general man- more technology transfers from their headquarters, there is a gen-
dustry, Baja California’s maquiladora program allows companies, logistics framework giving access to all parts of this region, col- ager of Gulfstream Mexicali. “The site’s employees make wiring eral reluctance from the global aerospace community to view Baja
usually from the United States, to open manufacturing operations laboration between the two countries and businesses operating in harnesses, sheet metal components, subassemblies and machined California and Mexico in general as capable of providing reliable
in Mexico for significant tax reductions. 70% of the aerospace both has flourished. “Cali-Baja Mega-Region initiative is some- parts that are used in the manufacturing process of Gulfstream’s design and engineering solutions. This reluctance means that it is
companies established in the state have a direct relation with Cali- thing that has been in the works for about six years. The EDC is full fleet of in-production aircraft.” up to the international prime contractors that are already operat-
fornia. “In 2015, we brought $2.5 billion of direct foreign invest- not competing with our counterparts, but rather we are comple- Ortega also notes that the ease of access to the U.S. is one of Baja ing in Mexico to promote Mexican capabilities to the world, as
ment into the state, and are expecting to increase that figure next menting each other,” said Rigel Navarro, executive director of the California’s major competitive advantages over Mexico’s other they are the most aware of their capabilities. International players
year,” said Carlo Bonfante, the secretary of Economic Develop- Tijuana Economic Development Corporation, a non-profit trade clusters. Honeywell, Eaton, and Hutchinson are all carrying out design and
ment for Baja California (EDC). organization. “There is a very interesting flow of trade, human re- In Tijuana, Baja California has developed a specialization in elec- engineering work in the region. “OEMs are relocating to Mexicali
tronics. Benchmark Electronics Tijuana was formed in 1985 and and Tijuana to carry out design work, e.g. Honeywell and Eaton
today manufactures circuit card assemblies, subassemblies, box Aerospace respectively. The design work in Mexico is being driv-
build, and very large scale integration. General manager Rod Gun- en by OEMs and not the contract manufacturer,” said Rod Gun-
ther said: “Benchmark Electronics has designated its Tijuana facil- ther, general manager of Benchmark Electronics.
ity to be its avionics center of excellence.” Honeywell, the 11th largest aerospace company in the world in
The biculturalism present in Baja California persuades sister com- 2014 in terms of revenues, has its largest concentration of global
panies in the United States to export more complex processes to employees in Mexico and opened its first manufacturing facility
the region. For instance, Switch Luz is the Mexican counterpart of in Mexicali in 1980. The company came to appreciate the innova-
Electro-Mech, which manufactures joystick and autopilot switch- tion and intellectual capabilities available in Mexico and opened
es and has been present in Baja California since 1966. Esterline’s the Mexicali Research and Technology Center (MRTC) to support
presence in Tijuana further strengthens Baja California’s reputa- Honeywell’s global operations. In 2007, it started supporting the
tion in the field of electronics engineering and design efforts of several component systems that
Zodiac Aerospace, a globally recognized aircraft interiors com- go into Airbus’ A350. Honeywell’s Mexicali research facility is
pany, has a facility in Baja California in addition to its operations on par with design centers around the world and is fast becoming
in Chihuahua. The presence of international giants, however, does recognized as an important player in global aerospace innovation.
not mean there is a shortage of opportunity for smaller Mexican The success of this center is due in no small part to the efforts of
companies. Innocentro is a recently established interiors company its engineers. Honeywell MRTC worked with local university CE-
in Mexicali. Roberto Corral, the company’s General Manager TYS to build a curriculum that was aligned with the center’s needs
said: “The aerospace industry is moving towards lighter and more and today many of their engineers are sourced locally.
convenient equipment.” Hutchinson is another international company that has capitalized
Baja California is mature enough that it can be more progressive on Mexico’s available talent and has developed a strong engineer-
in global trends. UTC Aerospace broke ground last year on a new ing team in Mexico over the past 10 years. The facility in Ensena-
facility in Mexicali that is focused on composite bonding. Also da is currently working on a product for the Boeing 737 MAX that
in Mexicali is GKN Aerospace Composite Structures, but general was developed with the help of its Mexican design team. President
manager Loren Engel, expressed more tempered hopes for prog- and CEO of Hutchinson Aerospace and Industry in Mexico, Tad
ress: “In terms of the engineers, the technical transfer is still chal- Shiner, said: “We have tapped into the hugely talented human re-
lenging and we are still moving towards getting the right systems sources pool and as a company with a strong Mexican staff, we
accessed.” want to promote to the world that our organization and engineers
To summarize Baja California certainly owed its initial growth to from this country are as capable as those from the U.S. or Europe.”
its proximity to the U.S. and still today benefits from being part Gulfstream also has a group of 30 employees who support engi-
Image: Gulfstream Aerospace Corp. Mexicali
MEXICO AEROSPACE 2016 - 22 - Industry Explorations Industry Explorations - 23 - MEXICO AEROSPACE 2016You can also read
