Foreign direct investment in Mexico $39B to date in 2024
Global corporations proceed to be bullish on Mexico’s economic prospects, as foreign direct investment (FDI) into the country totaled $38.2 billion from January through May, based on the country’s economy ministry.
The figure was a 35% increase in comparison with the identical period in 2023, when Mexico recorded FDI of $29 billion. FDI is measured as investments to expand, acquire or establish latest business in a rustic, based on the U.S. Bureau of Economic Evaluation.
Nearly all of investments in Mexico in the primary five months of the yr got here from the US, which accounted for $20 billion (51% of FDI). Germany ranked No. 2 at $5.7 billion (14%) and Argentina got here in third with $4.4 billion (11%).
Investments throughout the period were heaviest within the manufacturing industry, accounting for $21.8 billion (56% of FDI) for the period, the economy ministry said. Investments from the transportation sector got here in second, accounting for $5.1 billion (13%), while investments within the trade industry ranked third at $5 billion (13%).
Ritesh Kumar, a senior manager at The Smart Cube, said the consultancy is hearing from a various range of corporations looking to take a position in Mexico.
Based in London, The Smart Cube provides strategic research and analytics solutions and is a component of WNS Ltd., a business process management company with offices in Latest York, London and Mumbai.
“We’ve got seen corporations from across sectors who are actually looking to take a position in Mexico, and there have been quite a lot of announcements which have been made,” Kumar told FreightWaves during an interview. “The advantage of these announcements, they’re not only limited to traditional manufacturing corporations anymore. Increasingly what we see are high-tech corporations, in addition to areas comparable to life sciences, medical devices and so forth. As usual, we see automotive, aerospace, semiconductors, mass media and business industries, all of those sectors, we’re seeing investments coming into Mexico.”
Kumar said before any company invests in Mexico or another country, it should “future-proof” its interests.
“Once we are nearshoring, an important thing for any organization is that they need to not likely be shortsighted about it; they mustn’t have a look at short-term cost savings or efficiencies because the goal for driving their decision,” Kumar said. “It ought to be largely based on their assessment of long-term strategic vision, which relies on stability of the provision chain, reliability and robustness of the provision chain. They should be sure that that the choice they’ve made is future-proof, not only meeting their immediate requirements, but also they are capable of scale up because the organization grows and they’re able to deal with their future requirements.”
Related: Tropical Storm Alberto disrupting freight across Texas, Mexico
A number of the most up-to-date investment announcements throughout the first five months of the yr in Mexico were from Evergo, L&T Precision Corp. and Daikin Industries, based on Mexico’s economy ministry.
Evergo is a Dominican Republic-based electric vehicle charger manufacturer. Evergo is investing $200 million to put in 15,000 charging stations across Mexico.
Poway, California-based L&T Precision Corp. announced a $142 million deal in Mexico to construct a factory in Tijuana. L&T Precision is a provider of machining and sheet metal fabrication services.
Japan-based Daikin Industries, an organization that manufactures air con units, is investing $130 million to construct a factory within the Mexican city of San Luis Potosi.
Kumar said other considerations before relocating manufacturing to Mexico ought to be sourcing of raw materials and supplies, in addition to tariffs and geopolitical risks.
“Firstly, we have now to know what ought to be the best sourcing destination, whether it’s Mexico or if there are corporations which might be based within the U.K. or France. We’ve got to unearth the provision chain interdependencies, have a look at the Tier 2 and Tier 3 suppliers, and be certain that their supply chain can be robust in the longer term,” Kumar said. “One other thing we’d help with is trade data, evaluation of tariffs, which duty exemptions can be found between the various partner countries and so forth. Lastly, certainly one of the core elements that we provide is risk-related intelligence where we are able to have a look at geopolitical risks related to any latest nearshoring destination.”
BNSF pronounces intermodal logistics hub near Phoenix
BNSF Railway plans to construct a 4,321-acre logistics hub near Phoenix to reinforce transportation, storage and distribution of products throughout Arizona and the Southwest and promote sustainability, the corporate said in a news release.
The hub features a 1,770-acre intermodal terminal, an adjoining 1,420-acre logistics park for warehousing and distribution, and a 1,131-acre logistics center featuring direct rail-served sites to support local industries.
BNSF officials said the ability is scheduled to open in 2028.
Trailer manufacturer launches production facility in Eagle Pass, Texas
Utility Trailer Manufacturing Co. recently announced the opening of its Cargobull North America (CBNA) assembly plant and warehouse in Eagle Pass, Texas.
The ability is adjoining to Utility Trailer Manufacturing Co.’s Southeast Texas dealer location. The manufacturing plant and dealership will deal with the ultimate assembly operation of CBNA’s transport refrigeration units, together with final assembly of distant evaporators, solar panels and telematics hardware.
Utility Trailer Manufacturing Co. is a dry van, flatbed and refrigerated trailer manufacturing company headquartered in City of Industry, California. The corporate operates six production facilities across North America, including a plant across the border from Eagle Pass in Piedras Negras, Mexico.
Doosan Bobcat begins construction of $300M plant in Mexico
Doosan Bobcat Inc. recently began construction of a brand new factory in Monterrey, Mexico.
The 700,000-square-foot facility will produce the corporate’s Bobcat M-Series compact loaders for North American distribution.
The $300 million manufacturing plant was announced in November and is scheduled to open in 2026. It could generate as much as 800 jobs.
Doosan Bobcat Inc. manufactures construction and agricultural machines. The corporate is a subsidiary of South Korea’s Doosan Group.
Related: US suspends avocado inspections in Mexican state after inspectors assaulted
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