Economic growth is critical for every country, and that growth is largely dependent on international trade, relationships between countries, import/export, manufacturing, and various other types of production. In conjunction with production, keeping costs as low as possible is critical for any business to keep profit margins successful. As such, many companies choose to establish manufacturing operations through shelter companies in Mexico. In many cases, it makes sense for companies to focus on the ideas behind the company, and outsourcing certain parts of the business to Mexico is a great way to accomplish this. Mexican companies can focus on a business’s production and manufacturing, investing in industrial buildings for storage and assembly, and performing various accounting and human resource tasks for many businesses. These, among others, are great reasons to take advantage of the Mexican labor shelter program. Mexico provides many services through shelter companies.
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| Aerospace Mexico |
Mexican labor laws allow for unions, much like in the US, that help workers negotiate pay rates, time off, and various other aspects of working. Mexican labor laws are guided by the Ley Federal de Trabajo (Federal Labor Law). Many Mexican manufacturers enter into partnerships with shelter companies in Mexico to help them meet these laws. It is important for any company seeking Mexican labor to understand these laws and how they work.
Aerospace in Mexico has been extremely helpful toward Mexico’s growing economy. An airplane has a massive number of parts, from seatbelt buckles and huge brake pads, to thousands of precision screws. Mexico’s proximity to the US and low labor cost structure has drawn close to 500 foreign manufacturers to areas in five Mexican states. Some of these areas have developed large scale ecosystems for working on aerospace component manufacturing, making outsourcing these types of parts to Mexico extremely efficient. Most of the value from the aerospace industry comes from engine component manufacturing. Due to aerospace technology in Mexico, many high end aerospace companies seek Mexican manufacturing for their components.
Mexico’s low cost labor can be attributed to various aspects of their manufacturing and production structure. These include:
- A workforce experience with aerospace engineering and manufacturing components to a high tolerance.
- A workforce focused on quality manufacturing for electronic components to food.
- Mexico’s government and its desire to have a highly skilled, low cost workforce.
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| Mexican Labor |
Manufacturing in Mexico is a massive business. Many companies from various countries seek out shelter companies to work with in Mexico due to the low Mexican labor costs, and the ability to take advantage of Mexico’s various trade agreements. These agreements allow companies from certain countries, such as the US, to import raw materials to Mexico, have those materials converted to production level, sell-able, final goods and services, and re-import those goods back to the US, duty and tax free. Mexico can also ship directly to other end-market countries, which can save on shipping costs, as well as import/export services and fees. Mexican shelter companies can handle all paper work, permitting, and can deal with all of the appropriate government agencies on behalf of the company.
