Tecma University

Back to blog page

Trends that are impacting the emerging Mexican aerospace and defense market

Trends that are impacting the emerging  Mexican aerospace and defense market

Emerging Mexican aerospace and defense market growth will have positive implications for the industry in North America as a whole.

As the twelfth largest exporter of aerospace and defense products in the world, as well as the sixth largest supplier to the US market, Mexico merits close attention as it evolves, and emerges as a truly global leader in this industry. In the past few years, the emerging Mexican aerospace and defense market has attracted extensive foreign direct investment (FDI).

There are several factors and “megatrends” at work in this sector of the manufacturing economy, which will possibly propel Mexico into the position of being the world’s tenth largest aerospace and defense exporter within the next several years:

Megatrends to watch that may bring this about include:

Fuel Efficient and Environmentally Friendly Products
In order to minimize the effects of fuel volatility, OEMs in this sector are investing extensively in R&D to develop more efficient products, such as Pratt & Whitney’s new fuel-efficient engine, the PW1000G.

Manufacturing for Collaboration with Government and Academia for a More Skilled Workforce
Aerospace and aeronautics requires a highly competent and trained workforce, leading many companies to partner with government agencies and universities for improved institutions of training in areas such as engineering. The emerging Mexican aerospace and defense market has already benefited educational initiatives to raise workforce skill levels and bolster the quality of human resources.

Lean Manufacturing for Increased Production and Profitability
In the uncertain global macroeconomic environment currently facing OEMs, many firms are pursuing lean-manufacturing practices to overcome the rise in demand in the same or less time.

Nearshoring to Shorten Lead Times
In order to reduce transportation costs and lead time, A&D manufacturers are moving operations in closer proximity to high-demand markets, such as Airbus’ recent move of some component manufacturing from Asia to Mexico.

Increased Development of Regulatory Framework and Industry Clusters
While one of the most conducive markets for international trade, due to nearly fifty international free trade agreements, the emerging Mexican aerospace and defense market is also attracting R&D operations through improving regulatory framework for better protection of intellectual property rights, while simultaneously forming industry clusters in aerospace manufacturing to increase competitiveness.

Vertical Integration and Global Alliance
Aerospace manufacturers are seeking out niche suppliers internationally to vertically integrate and globalize their supply chain through both acquisitions and strategic partnerships, as seen in the development of the local-supplier network in the Nuevo Leon cluster meant to allow smaller Mexican A&D companies to integrate with larger OEMs.

Turning to Developing Nations
OEMs are focusing more on developing nations around the world in places like Africa and South America, which positions Mexico as a choice location for targeting developing Latin countries.

Growth for Business Jet and Single-Aisle Segments
With the global recession wearing off, business jets are making a comeback, especially in the US. This has led to a renewed focus on next-generation technology and growth for the single-aisle and business-jet classes among the major manufacturers like Boeing and Airbus.

Share

Join discussion in this post

Get in touch

Fill out the contact form. One of Tecma’s team of trusted professionals will contact you promptly about advantages of manufacturing in Mexico.

Get in touch

Subscribe to the Tecma News Brief

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.