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Principal clusters of manufacturing in Ciudad Juarez, Mexico

The maquiladora manufacturing industry has played a vital role in technology transfer into and development of the local economy. Principal clusters have played a key role in constituting what now characterizes manufacturing in Ciudad Juarez.

As industry began to appear on the U.S.-Mexico border in the 1960s, Juárez came to be home to the one of the largest concentration of maquila jobs in Mexico. Inevitably, the region has become a significant provider of manufactured components and commodities that are distributed throughout North America, and the world.

What has developed there over the years is a concentration of thriving interconnected Mexico manufacturing clusters and networks that are composed of OEMs and suppliers that have created a value chain that has attracted ever increasing amounts of foreign direct investment (FDI).

No economy is an island, and studying the symbiotic relationships of the industrial clusters that characterize manufacturing in Ciudad Juarez is advantageous in that it identifies opportunities for growth and strategic targeting as regards the supplier-manufacturer-purchaser economy. In a unique study of the El Paso/ Cd. Juárez region, the Institute for Policy and Economic Development at the University of Texas at El Paso examined customer-supplier linkages between Cd. Juárez manufacturing operations and El Paso industry. The work provides insight into areas for development among these Mexican industry clusters, with an eye towards fostering regional economic expansion, competitiveness, and industry health and stability.

According to the Institute’s study, the top 10 Mexico manufacturing clusters in Juárez are as follows:

1. The Mexican Automotive industry (82,000 jobs) is the largest sector, and utilizes inputs (commodities) from three significant supplier segments in Ciudad Juárez: motor vehicle parts manufacturing, iron & steel mills & ferroalloy manufacturing, and nonferrous metal foundries manufacturing.

2. Semiconductor/Electric Parts (31,000 jobs) primarily uses suppliers in semiconductor & related device manufacturing, printed circuit assembly manufacturing, and other basic inorganic chemical manufacturing.

3. Electrical Equipment (17,000 jobs) primarily uses relay & industrial control manufacturing, iron & steel mills & ferroalloy manufacturing, and printed circuit assembly manufacturing.

4. Medical Equipment (12,000 jobs) primarily uses materials from surgical & medical instrument manufacturing, surgical appliance & supplies, and advertising & related services.

5. Communications Equipment (8,000 jobs) pulls primarily from broadcast & wireless communication equipment manufacturing, semiconductor & related device manufacturing, and software publishers suppliers.

6. Printing Ink (7,000 jobs) primarily utilizes inputs from synthetic dye & pigment manufacturing, paint & coating manufacturing, and petroleum refineries manufacturing suppliers.

7. Navigational, Measuring, Electromedical, and Control Instruments (7,000 jobs) acquires most of their materials from software publishers, scientific R&D services, and printed circuit assembly manufacturing.

8. Audio & Video Equipment (7,000 jobs) relies primarily upon suppliers in electron tube manufacturing, printed circuit assembly manufacturing, and custom computer programming services.

9. Plastics Product (6,000 jobs) uses inputs from plastics material & resin manufacturing, plastics packaging materials & unlaminated film & sheet manufacturing, and other basic organic chemical manufacturing.

10. Household Appliance (5,000 jobs) utilizes plastics packaging materials & unlaminated film & sheet manufacturing, other plastics product manufacturing, and motor generator manufacturing suppliers, often from within the Juárez region.

Clusters of manufacturing in Ciudad Juarez, Mexico in all likelihood, will continue with their steady expansion. Rising costs for manufacturers in China, as well as for those in the United States, make the city a preferential venue for low-cost nearshore production.

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This quarterly publication will be populated with content that is useful and relevant to readers that are contemplating Mexico investments, have operations already within the Republic, as well as to other individuals that have an interest in Mexico and its manufacturing sector.