Tijuana Is a Manufacturing Powerhouse and More Investment Is Ahead
For decades, Tijuana has been an established manufacturing hub where companies from all over the world set up operations for the U.S. market. The availability of a skilled workforce as well as its closeness to the U.S., are making this city more appealing for new investment.
The city has several industries manufacturing different products for the U.S. market, from pickup trucks and electronics to medical devices and aerospace-related parts.
In 2022, Tijuana had 595 active manufacturing sites, the highest number of facilities in Mexico. The aerospace, electronics and medical device industries account for more than one third of these manufacturing sites.
Moreover, 259,641 skilled employees work these manufacturing sites and unemployment is less than 3%. The city has embraced the dual education system and has a vast pool of engineers and bachelor graduates. Most of them are at least partially bilingual.
Top Manufacturing Industries in Tijuana
More than 55 aerospace and defense companies operate in Tijuana, including Honeywell, ICON and Gulfstream. This industry employs more than 28,000 people. Some of the products they make include cabin interiors, components for landing systems, audio and video systems, airframe parts, aircraft composite structures and machining and metal turbine parts. Also, some companies offer MRO services.
Another dynamic industry in Tijuana is electronics manufacturing and assembly. This industry has around 122 active companies in the city, including Samsung Electronics, Jabil and Eaton. These companies employ approximately 100,000 people. From printed circuit boards, TVs and cellphones to components for aerospace, medical device and automotive industries, this industry offers a wide variety of products made in Tijuana.
Also, the medical device industry comprises 44 companies -including Medtronic- and employs more than 42,000 people. The medical device companies in Tijuana manufacture a wide variety of products, including cardiovascular disease treatment and technology, orthopedic devices, medical instruments, prefilled syringes, hypodermic products, surgical kits, and wound care products, among others.
Why Companies Are Choosing to Invest in Tijuana
Many industrial facilities carry international accreditations and comply with global standards for quality and safety. Companies will find first-class facilities that are FDA, CE and ISO 13485 certified, as well as unique processing plants offering clean rooms ranging from Class 100 to 100,000.
All this industrial activity has turned Tijuana into an essential part of the global supply chain; therefore, more companies are establishing operations there to avoid the logistical struggles of offshoring production in Asia.
Thus, Tijuana has a low vacancy. The new wave of nearshoring-related expansions is driving the high demand of industrial space. Increased deliveries in 2023 will allow for more absorption because the vacancy rate is at an all-time low.
Last year, Asian companies drove most of this growth, mainly from South Korea and China and more expansions and new operations are on the way.
To be able to accommodate this growth, real estate developers are building around 5.3 million square feet of industrial space, according to Economic and Industrial Development of Tijuana (DEITAC). These developments represent a US$635 million investment made by 17 real estate developers.
In the last decade, Tijuana has attracted more than US$8 billion in Foreign Direct Investment (FDI) and this trend might continue in the upcoming years, driven by the new nearshoring movement.