Increased demand creates growth opportunity for plastic injection molding in Mexico
As the global economy becomes more and more competitive, the appeal of doing business in Mexico has grown for plastics OEMs around the world. Given this development, there has been a proliferation of plastic injection molding in Mexico.
Since the signing of NAFTA over two decades ago, Mexico’s industry has grown to rely significantly on maquiladora manufacturing operations. This focus on industrial production – combined with recent improvements in infrastructure, legal climate, quality labor, and strategic positioning in the global economy – have attracted many of the largest companies in the world to within the confines of Mexico’s borders. Of particular consequence in Mexican manufacturing are companies specializing in aerospace manufacturing in Mexico, automotive, and other industries heavily reliant on injection molding and plastics. Due to this fact, plastic injection molding in Mexico is thriving.
Molding and Plastics OEMs Coming to Mexico
In a recent article by Plastics Today, author Clare Goldsberry points out some of the firms that have started new operations, or have strengthened their presence in Mexico. She also examines the issues affecting this transition. Goldsberry notes that, while there has long been a strong draw for suppliers in the US and other economies to do business in Mexico, there has also been a reluctance for US plastic injection molders and mold makers to shift production south of the border. Historically, this has been due to difficulties such as finding skilled labor in Mexico. Many companies are now finding out, however, that this and other obstacles are swiftly fading away as Mexico invests in training centers, university-industry partnerships, and incentives. It is feasible to conduct quality plastic injection molding in Mexico operations today.
For example, Evco Plastics -Evco settled in Monterrey approximately 15 years ago. During the time that it has been in Mexico, the company has reported exponential growth. Evco has two plants in Monterrey and a 77,000-square-foot molding facility in Juarez. All three plants have received significant upgrades and investment in recent years as the company eyes even further expansion in Mexico. Furthermore, a fourth plant is potentially in the works.
Another example is Group MGS. The manufacturer has conducted plastics injection molding in Mexico in a facility in Chihuahua for nearly a decade, and has, during that period, supplied the automotive and electronics industries for the North American market. Plans are currently in the works for the company to greatly expand capacity at that site in the near future.
The Rise of Regionalism
While China and Mexico are virtually on par at this time as regards overall production costs, plastics and molding suppliers are beginning to choose Mexico over China with greater frequency. This is due to a myriad of advantages that a Mexican location represents. According to expert maquiladora industry sources, more than $10 billion in foreign direct investment has poured into central Mexico over the past two and a half years. The inputs that are created are created to incorporate into further manufacturing from this investment tend to stay in North America. Likewise, what is now being produced in China is being sold to Chinese or Asian markets. This trend is becoming the new norm, and Mexico stands to be the manufacturing partner of choice for the North American region among plastics suppliers, molders, and other sectors included.