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The strong US dollar results in more Mexican manufacturing expansions

The strong US dollar results in more Mexican manufacturing expansions

According to maquiladora industry leaders in Tijuana, a strong US dollar has generated a noticeable uptick in Mexican manufacturing expansions.

The upside

Although negative effects can be identified on both sides of the border as a result of the strong US currency, as it measures against the Mexican Peso, Tijuana maquiladora industry officials see an upside. According to the president of the Tijuana Index organization, Luis Manuel Hernandez, the strong US dollar has provided the impetus that has motivated ten local manufacturers to undertake expansions of their Mexican manufacturing operations. According to Hernandez of Index, the maquiladora industry’s national association, the low price of a barrel of oil on the world market has also had an influence on this development. In addition to proving to be a strong incentive for companies in Tijuana, as well as the rest of the State of Baja California, expand their Mexican manufacturing operations, the current US-Mexico exchange rate situation has also proven to be a carrot for firms looking to set up south of the US-Mexico border.

New companies show interest in the region

For his part, Xavier Peniche Bustamante, Tijuana’s secretary of economic development, recently announced that six companies are on-line to make new investments in the municipality. He expects more such investments to come to Tijuana, as well as harbors the belief that a strong dollar driven Mexico cost advantage will have repercussions for the state as a whole. Nine hundred foreign-owned maquiladora plants are located throughout Baja California. Although the main concentration of manufacturing activity is centered in Tijuana, other entities such as Mexicali, Tecate, Ensenada and Rosarito are areas that attract and support significant industrial activities

A focus on Tijuana and Baja California

In part, because of the influx of new business, as well as activities related to Mexican manufacturing expansions, Tijuana will be the location of this year’s meeting of the maquiladora industry’s national association, known in Spanish by the acronym Index. The gathering of industry leaders from all corners of the country will take place at the Rosarito Convention Center between the 16th and 18th during the month of November. Index’s president, Luis Manuel Hernandez, believes that the siting of the event in Tijuana will place a focus on what industry in the area calls the “Mega-Region,” which is comprised of the Baja California border region and the San Diego area including broader Southern California.

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