08Abr

Mexican Startup Kavak Valued at $4 Billion After Latest Round

abril 8, 2021 Jesus Aguirre

Mexican used car startup Kavak raised a record amount of financing to fund a major expansion into Brazil and is now valued at $4 billion.

The Mexico City-based startup plans to begin operations in Brazil after the Series D funding round which raised $485 million and was led by D1 Capital Partners, Ribbit Capital, BOND and Founders Fund Management LLC.

The company, which currently operates in Mexico and Argentina, may enter additional countries in the coming 24 months, said co-founder and chief executive officer Carlos Garcia.

“The market is enormous, it’s broken and it’s really informal,” Garcia said in an interview, adding that the used-car market is worth $60 billion annually in Mexico alone, with 80% of those transactions made between individuals. “The pandemic accelerated consumers’ trust in digital platforms, and car demand will continue growing globally due to social distancing needs.”

Kavak buys used cars through its app, refurbishes them and then sells them to consumers, with the option of giving them medium term financing. Company transactions surged during the pandemic as stay-at-home measures encouraged buyers to move safely in their own cars, and look for cheaper second-hand options. The company grew to 2,500 employees in the past six months, up from 500 before.

The company is planning to use the financing to grow its car inventory to 30,000 cars in the next 18 months — up from 12,000 vehicles currently — and to boost its financing credit lines, invest in technology and in infrastructure including warehouses and refurbishing centers.

Kavak’s upfront investment in Brazil means that it will have more infrastructure there than in Mexico, its home market which is currently its largest.

Kavak was founded in 2016 after Garcia faced multiple setbacks when trying to sell his car to move from Colombia to Mexico, from mechanic issues to receiving incorrect information on the car. That drove him to add transparency to a market prone to fraud, and with potential to grow across emerging markets beyond Latin America, Garcia said.

In prior rounds, Kavak has been also backed by SoftBank Group Corp., Greenoaks Capital, DST Global and Kaszek Ventures, among others. Garcia declined to give an estimate for when the company might look to do an initial public offering.

Source: Bloomberg

(https://www.bloomberg.com/news/articles/2021-04-07/mexican-startup-kavak-valued-at-4-billion-after-latest-round)

07Abr

Understanding the IMMEX Program

abril 7, 2021 Jesus Aguirre

Mexico is an attractive destination for transnational companies, being the world´s fourteenth largest FDI recipient. This is due to the different advantages Mexico offers, among others: strategic geographical position, highly qualified and low cost labor force, its free trade agreements, and its incentive programs, such as the IMMEX program, formally known as the IMMEX Maquiladora Program, which enables foreign companies to operate in Mexico under a preferential tax structure.

What is IMMEX?

Immex stands for the Maquiladora, Manufacturing and Export Services Industry.

Its objective is to strengthen national exports, and to provide companies with tools to adopt new forms of operation and making business, modernize and reduce processes, all in an environment that encourages the attraction and retention of investments in the country.

The IMMEX authorization is an instrument which allows the temporary import of goods that are used in an industrial process or service , to produce, transform or repair foreign goods imported temporarily for subsequent export, without paying VAT and countervailing duties, and deferring or not paying General Import Tax.

One of the main requirements for the IMMEX program is to have annual sales abroad of at least USD $500,000, or invoice exports accounting for at least 10 percent of the total company invoices.

Benefits of the IMMEX Program

The main benefit of the IMMEX Program is they can temporary import of raw materials, components, machinery and equipment among others without paying VAT and countervailing duties and deferring or not paying General Import Tax.

Nevertheless, within a fixed timeframe, the finished manufactured good must be exported, transferred to another IMMEX program, or proceed with a change of regime.

The timeframe in which the temporary imported materials may remain in national territory, according to article 4 of the IMMEX Decree and Article 108 of Customs Law is as follows:

6 months:
- The goods subject to transfer by means of virtual operations, will have a period of permanence of up to six months.
18 months:
- Fuels, lubricants and other materials that are going to be consumed during the production process of the export merchandise.
- Raw materials, parts and components that are going to be used entirely to integrate export merchandise.
- Bottles and packages.
- Labels and brochures.

2 years:
- Container and trailer boxes

For the validity of the program
- Machinery, equipment, tools, instruments, molds and spare parts for the production process.
- Equipment and devices for pollution control, research and others mentioned in article 108 of the Customs Law.
- Equipment for administrative development.

Categories of IMMEX program

There are 5 different types of IMMEX registrations:

IMMEX Holding Company Program:

Applies when the manufacturing operations of a certified company called holding company and one or more controlled companies are integrated into the same program.
IMMEX Industrial Program:

Applies when an industrial process of elaboration of transformation of merchandise destined for export is carried out.
IMMEX Services Program:

Applies when services are performed on export merchandise or export services are provided, solely for the development of activities that the Ministry of Economy determines
IMMEX Shelter Program:

Applies when one or more foreign companies provide the technology and productive material, without operating the program directly.
IMMEX Outsourcing Program:

Applies when are certified company that does not have facilities to carry out production processes, carries out manufacturing operations through third parties that it registers in its Program.

How to take advantage of the benefits of the IMMEX program in Mexico

The application of the IMMEX program is a complex process and contains several requirements that need to be fulfilled. Furthermore, to maintain the authorization the company must comply with several reporting requirements among many other obligations such as maintaining an automated inventory control (Annex 24), maintain the goods at the addresses that are registered in the program, among others. Therefore, many foreign companies, partner with experienced partners such as a shelter service provider, like Mexcentrix, for a quicker and correct access to the benefits of the program. .

Mexcentrix can support your company in the full process since the application of the IMMEX program and management of it, including filing required reports and fulfilling all obligations.

06Abr

Annual Report of Foreign Trade Operations

abril 6, 2021 Jesus Aguirre

In accordance with article 25 of the IMMEX Decree and article 8 of the PROSEC Decree, companies with an IMMEX and PROSEC program must present the Annual Report on Foreign Trade, with respect to total sales and exports (*), corresponding to the fiscal year immediately preceding fiscal, from April 1 and at the latest on the following dates:

Companies with PROSEC Program: No later than the last business day of April
Companies with IMMEX Program: No later than the last business day of May
Companies with both programs (PROSEC and IMMEX): No later than the last business day of April, since it is a single procedure for both programs.

* It must be verified that the IMMEX company complies with the obligation of the program to make annual sales abroad for a value greater than $ 500,000 USD, or its equivalent in national currency, or invoice exports, for at least 10% of its invoicing total.

Consequences in case of not presenting on time:

PROSEC:

If the annual report is not presented on the established date, the Program will be suspended until the omission is corrected.

If the report is not submitted by the last business day of June of the current year, the program will be canceled as of July 1, 2021.

IMMEX:

If the annual report is not presented on the established date, the Program will be suspended until the omission is corrected. It may be submitted until the last business day of August of the current year. During the suspension period of the IMMEX Program, the company will not be able to temporarily import merchandise or enjoy the other benefits of the Program.

In case of not presented on the established date the report, the IMMEX program will be definitively canceled as of September 1 of the current year. Derived from it, the company will have 60 calendar days to change the regime of temporary goods to definitive import or return them abroad.

Information needed for the presentation:

The Annual Report is presented through VUCEM, and the total sales for the year 2020 and the total commercial value exported in 2020 must be declared. If with the information presented the system verifies that the export commitments are not fulfilled, a start of the cancellation procedure for the IMMEX Program.

To present the report correctly, it is recommended to have the following information and documentation, among others:

Data Stage for fiscal year 2020
Annual Declaration for fiscal year 2020
Invoicing to assemblers and CTMS received.

You have doubts? At Mexcentrix we have experts in the area of Foreign Trade to advise you. Avoid the suspension and / or cancellation of your IMMEX program, and get advice from the experts.

30Mar

Wise Harness Solutions Expands into Emplame, Sonora, Mexico

marzo 30, 2021 Jesus Aguirre

Since 1970, Weston, Wisconsin-based Wise Harness Solutions has assembled wire harnesses, battery cables and control panel assemblies to support its customers’ wire harness needs. The company prioritizes offering high-quality products, delivered on-time, at an excellent value and sees its expansion into Mexico as one more way to deliver upon this promise.

The decision to expand into Mexico came as Wise Harness Solutions executives sought a solution to the ongoing labor shortage plaguing manufacturers across the U.S. The company had found itself struggling to grow its Wisconsin workforce to support the demand from its customers. With more of its competitors moving into Mexico, the company recognized that the lack of a Mexican presence, combined with this workforce shortage, would make it more difficult to provide the highest quality products, on-time delivery, at the competitive price its customers expected.

Michaud adds, “We selected Empalme as the location for our new facility due to its proximity to the U.S. and the availability of an experienced workforce.” Empalme is a mere four-hour drive to the U.S. border. However, it’s location along the sea of Cortez, the second largest port on the Pacific Coast, provides manufacturers with additional options for cost-effectively reaching global customers in a timely manner.

The 25,000-square-foot facility will begin producing complex OEM vehicle wire harnesses, battery cables and control panels by early April 2021. Wise Harness executives expect that the additional capacity this facility affords will help the company to bid on more projects, allowing for additional expansion in product offerings over the next few years.

press_release_distribution_0480344_163010

Source: CISION PR Newswire

( https://www.prnewswire.com/news-releases/wise-harness-solutions-expands-into-emplame-sonora-mexico-301254507.html)

29Mar

Maquiladoras in Mexico

marzo 29, 2021 Jesus Aguirre

For many years, manufacturing companies have sought to increase the efficiency of their production operations and reduce costs, leading them to establish manufacturing plants in countries other than their places of origin. This has led to an increase in foreign investment and to the origin one of the main industries in the country: the maquiladoras in Mexico.

The maquiladora program was established since 1964 in order to attract foreign investment and combat unemployment in the U.S and Mexico border.

In addition, in 1994 with the signature of NAFTA (North American Free Trade Agreement) which has been ratified and today we know was USMCA (United States- Mexico – Canad Agreement), boosted during the late 90´s the number of maquila plants especially in the border of Mexico and United States.

What are Maquiladoras?

A maquiladora is a manufacturing operation in Mexico which is run by a foreign company and exports goods to other countries.

Maquiladoras import raw materials, components and machinery to process or assemble them in Mexico and then export back the finished manufactured goods. The main advantage of the maquiladoras is that the raw materials, components and equipment for production purposes can enter the Mexico under a duty-free and tax benefit structure.

In 2006 the maquiladora program was transformed and the IMMEX Program was established. The IMMEX Program which is the acronym for Manufacturing Industry, Maquiladora and Export Services, encourages manufacturers to export goods and strengthen Mexican exports.

As of February 2021, according to the National Foreign Trade Information Service of the Ministry of Economy (SNICE), for its acronym in Spanish, there are 6,003 IMMEX Programs in Mexico.

Learn more about the details of the IMMEX Program here.

Benefits of Setting up a Maquiladora in Mexico:

Tax benefits:

Temporary import of raw materials, components, machinery and equipment among others without paying VAT and countervailing duties and deferring or not paying General Import Tax.

Free Trade Agreements:

Furthermore, Mexico counts with 13 Free Trade Agreements with 50 countries, leading to a reduction of trade barriers and allowing foreign companies to import some raw materials and products free of duties. Additionally, these FTA’s provide Mexico with access to around 60% of the world’s GDP.

Cost Savings:

Maquiladoras in Mexico, can benefit from having highly qualified and trained workforce at competitive labor costs.

In addition, if the finished good will be sold to United States, it offers important logistics costs savings due to cheaper shipping costs and shorter overall times for shipping, which also lead to faster delivery.

Location and Product Flexibility:

A maquiladora can be established anywhere in the country, and still benefit from the tax savings advantages.

Furthermore, foreign companies that establish maquiladoras in Mexico have no limit on the types of items that can be manufactured (with the exception of firearms), as long as the manufactured finished good is exported.

Fast and easy start-up through a shelter company:

Establishing a maquiladora in Mexico is easier when partnering with a shelter service provider in Mexico. As the shelter company can be the legal entity in Mexico, or can provide service through a new legal entity, while offering a faster and easier start-up due to their experience and know-how on local practices and regulations. In addition to taking care of all administrative matters which the company on and allowing the foreign company to focus on what they do best (production, quality, materials).

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How to establish a Maquiladora through a shelter company?

Hiring a shelter service provider for establishing a maquiladora in Mexico, can facilitate the complete process and is often the easiest way to maximize the benefits that the maquiladora program offers.

Mexcentrix can lead and support you in the complete process for establishing manufacturing operations in Mexico. Our shelter service offers full administrative and operational support including, among others:

Human resources
Payroll and benefits administration
Tax and accounting
Foreign trade and customs
Management IMMEX Program

Through our shelter program, our clients can focus on what they do best (production, quality, materials) and let us do what we do best.

Furthermore, through Mexcentrix services, we ensure 100% compliance with Mexican law and regulations, and our clients can avoid unnecessary problems and costly mistakes. In addition, we offer ongoing consulting to keep our clients updated about any changes in applicable laws and regulations.

For additional information regarding our services or if you need a cost model for your operations in Mexico, contact us.

26Mar

Exports, stimulus throw lifeline to Mexico’s battered economy

marzo 26, 2021 Jesus Aguirre

In an arid valley in central Mexico, one of the world’s largest automotive suppliers is preparing to open a new plant to produce components for North America, underpinning the export business that has kept the country’s struggling economy ticking over.

The new Continental AG plant in Aguascalientes state should benefit from the new United States-Mexico-Canada (USMCA) trade deal and U.S. President Joe Biden’s $1.9 trillion stimulus plan to revive growth after the coronavirus pandemic.

The confidence expressed by local executives of the German parts maker echoes growing optimism among analysts that a global recovery will lift Mexico’s economy more than previously expected, despite ongoing weakness in domestic demand.

“We’ve got high (auto) output coming, high volumes for everyone, and that’s what we’re getting ready for,” said Ina Seterbakken, the manager of plant still under construction.

Continental expects business to revive after delays caused by pandemic-related disruptions, Seterbakken said, noting the facility was a strategic bet given Mexico’s proximity to the United States, the world’s biggest economy.

The new plant, which will employ about 1,000 people, joins a thick belt of automotive factories clustered in central Mexico, whirring with machinery focused chiefly on satisfying export demand that the market access of USMCA provides.

“If (USMCA) hadn’t been agreed, it would have really changed this country’s economy,” said Gustavo Puente, economy minister in the central state of San Luis Potosi, which recently unveiled a separate 60 million euro Continental investment.

Mexico’s economy last year suffered its worst slump since the 1930s, with gross domestic product (GDP) shrinking by 8.5%. Robust foreign demand ensured the outcome was not worse.

President Andres Manuel Lopez Obrador has resisted calls to splash out to prop up the economy, arguing that bailouts and deficit spending tend to line the pockets of the rich.

But his country has benefited from stimulus spending in wealthier countries, especially the United States, which soaks up around 80% of all Mexico’s goods exports.

The automotive industry forms the core of manufacturing output, which makes up almost a fifth of Mexico’s economy.

Buoyed by the prospect of a revival north of the border, Mexico’s government is revising up its 2021 growth forecast to 5.0-5.5%, and Finance Minister Arturo Herrera said the U.S. stimulus plan was “very important” to the country.

Private sector analysts are doing the same, with JPMorgan recently raising its 2021 estimate for the second time this year to 5.6%.

“If it weren’t for such a strong program in the United States this year, Mexico might be growing 2.5% or 3%,” said Gabriel Lozano, the U.S. bank’s chief economist for Mexico.

COMMERCIAL EDGE

Mexico has committed funds worth about 1.3% of GDP to reviving its economy, according to International Monetary Fund (IMF) calculations. In Brazil, by contrast, it is 6.2%.

Yet despite that, Mexico’s economy is expected to grow by 4.3% this year versus 3.6% for Brazil, the IMF estimates.

Export exposure is one reason.

Worth some $360 billion before the pandemic, according to U.S. official data, Mexican annual exports to the United States are equivalent to about a third of GDP. Brazil’s U.S. exports were worth under $31 billion in 2019.

The difference between Latin America’s two biggest economies also shows up in financial markets: while the Mexican stock exchange has gained 4.9% so far in 2020, the Brazilian exchange has lost 8.2%, when measured in dollars.

Nevertheless, some analysts and bosses in Mexico have their doubts. They note that appetite for manufactured goods abroad contrasts with flagging domestic demand, with Mexican fixed capital investment plummeting more than 18% last year.

How well Mexico recovers will depend in part on the government’s ability to overcome tensions with business and encourage investment in manufacturing, which could profit from a drive to regionalize supply chains away from Asia under USMCA.

Drawn to lower-cost Mexico to get a competitive edge, companies are watching nervously to see if the government’s moves to strengthen state control of the electricity market will affect energy-intensive sectors like carmaking.

“(The electricity sector) is decisive for the Mexican economy to grow steadily, but for this, the state must guarantee the principles of free competition and legal certainty,” the American Chamber of Commerce (AmCham) in Mexico said last month.

Source: REUTERS

( https://www.reuters.com/article/us-mexico-economy-analysis-idUSKBN2BB2BO )

18Mar

Honda temporarily cutting production at all U.S., Canada plants

marzo 18, 2021 Jesus Aguirre

Honda Motor Co said late Tuesday supply chain issues will force a halt to production at a majority of U.S. and Canadian auto plants for a week.

The Japanese automaker added the issue will result in some production cuts next week at all U.S. and Canadian plants, citing “the impact from COVID-19, congestion at various ports, the microchip shortage and severe winter weather over the past several weeks.”

“In some way, all of our auto plants in the U.S. and Canada will be impacted,” Honda said.

Some U.S. and Canadian plants are expected to have smaller production cuts next week, but a spokesman for Honda added “the timing and length of production adjustments could change.”

The company declined to specify the volume of vehicles impacted but said “purchasing and production teams are working to limit the impact of this situation.”

The company added when production is suspended Honda workers “will continue to have the opportunity to work at the impacted plants.” Honda workers were notified of the production cuts Monday.

Sam Fiorani, vice president of global vehicle forecasting at AutoForecast Solutions, said Honda typically produces about 30,000 vehicles a week in the United States and Canada.

The production issues are hitting Honda plants in Ontario, Ohio, Alabama, and Indiana. Honda said its Mexico operations have not announced any production cuts.

The chip shortage, which has hit most of the global automakers, stems from a confluence of factors as carmakers, which shut plants for two months during the COVID-19 pandemic last year, compete with the sprawling consumer electronics industry for chip supplies.

General Motors Co has cut production at many plants and warned it could shave up to $2 billion from this year’s earnings.

GM’s U.S. rival Ford Motor Co previously said the shortage could hurt 2021 profit by up to $2.5 billion and said it had curtailed production of its flagship F-150 pickup.

Source: REUTERS

(https://www.reuters.com/article/idUSKBN2B9042 )

18Mar

Foxconn says may make EVs in Wisconsin or Mexico

marzo 18, 2021 Jesus Aguirre

The chairman of top Apple Inc supplier Foxconn said on Tuesday that its plant in the U.S. state of Wisconsin was a potential site to make electric vehicles, but added that Mexico was another possible site.

Asked by reporters in Taipei whether the company would produce a car with Apple, Chairman Liu Young-way said that was speculation.

Taiwan-based Foxconn, formally called Hon Hai Precision Industry Co Ltd, is the world’s largest contract electronics manufacturer.

Source: REUTERS

( https://www.reuters.com/article/idUSB9N2IW026 )

17Mar

Advantages of Manufacturing in San Luis Potosi

marzo 17, 2021 Jesus Aguirre

The manufacturing industry is the main economic activity in the State of San Luis Potosi.

There are several advantages of manufacturing in San Luis Potosi. Therefore, the manufacturing industry in San Luis Potosi, is extremely important and represents approximately 25% of its Gross Domestic Product (GDP). For instance, San Luis Potosi counts with a total of 9,962 manufacturing companies.

Furthermore, San Luis Potosí ranks in fifth place of the ten world cities with less than two million inhabitants that show the greatest economic potential, according to the ranking Global Cities of the Future published by the Financial Times magazine. Likewise, the capital of San Luis Potosí, ranks ninth among cities for the highest business profitability.

Moreover, San Luis Potosí occupies second place within Mexico, in terms of the specialization of the states in the automotive industry due to its added value of 39.4%, according to the Government of the State of San Luis Potosí. The manufacturing sectors with the highest participation in the state are transportation equipment (automobiles and auto parts), industrial machinery and equipment, electric appliances and electrical power generation equipment.

Why is San Luis Potosi one of the main manufacturing States in Mexico?

San Luis Potosi is an attractive state among the manufacturing industry, due to its competitive and highly skilled labor force, its privileged geographical location, and its existing clusters such as the automotive, logistics and medical cluster, which as a result you can find numerous suppliers from these industries in the State. In addition to its extensive number of highly developed industrial park, among other advantages San Luis Potosi offers for manufacturing companies.

Some of the main advantages that make San Luis Potosí an attractive state for companies looking to establish manufacturing operations in Mexico are listed below:

Privileged geographical location

San Luis Potosí is located in the center of Mexico, having access in a range of 2 to 7 hours by land, to the main cities and ports of the country, as well as the EE.UU border. Certainly, due to its strategic location, companies have access to a concentrated supply chain, in a 300 km radius there is access to more than 850 automotive suppliers and 9 assembly plants.

Supply Chain

San Luis Potosi, counts with a fast growing automotive supply chain. The establishment of two OEM Plants (BMW and GM) which together employ more than 3,300 employees, led to strengthening the local automotive cluster, leading to more than 200 companies from the automotive industry in the State.

In addition, the State counts with a strategic tax scheme (Recinto Fiscalizado Estrategico), which provides a competitive advantage due to time saving in the supply chain of companies.

Labor Force

The state has a population of 2.8 million, with approximately 1.2 economically active individuals. Of these, approximately 20% are employed working in manufacturing industries.

San Luis Potosí has international educational institutions, universities, and technological institutes with programs focused on the needs of the industry, including dual programs. According to the Secretary of Public Education (SEP), from 2016 to 2019 there were more than 54,000 graduates from universities or technical institutes of which more than 30% of these are professionals in engineering and telecommunications careers.

Furthermore, the state counts with training centers, and centers for research, innovation and technological development in this area.

In addition to highly skilled labor force, San Luis Potosi counts with competitive labor costs.

Infrastructure

The state has the largest intermodal terminal in Mexico (RFZ) where approximate 20,000 loading and unloading maneuvers are carried out monthly.

Manufacturing companies in San Luis Potosi

Furthermore, San Luis Potosi counts with more than 20 industrial parks. The availability of highly developed industrial parks reflect the opportunities for new investments, and facilitates companies to transfer their products to other states and worldwide.

Due to the manufacturing advantages San Luis Potosi offers, several foreign companies have decided to establish manufacturing operations within the State.

Despite of the difficult economic situation that the world and all states in Mexico are going through, San Luis Potosi was one of the top 5 states with greater foreign direct investment (FDI) in the first semester of 2020, reaching a total of $880.20 million dollars, according to Lider Empresarial.

Are you thinking of establishing manufacturing operations in San Luis Potosí?

Mexcentrix can help you, our headquarters are established in San Luis Potosí. We count with over 20 years of experience providing strategic guidance for low risk manufacturing in Mexico. We assure your company a successful and timely start of operations in Mexico.

The business services we offer are, among others:

Our services are 100% guaranteed, we are committed to the high quality service that our clients deserve, and we count with the know-how, experience and infrastructure to make it happen.

Start your Mexico manufacturing operation successfully, with help from the experts.

Contact us

04Mar

Advantages of Manufacturing in Mexico in 2021

marzo 4, 2021 Jesus Aguirre

Mexico presents advantages for manufacturing companies in 2021

Last year (2020) was a tough one for all industries, including the manufacturing industry, as they had to lead with a significant reduction in income and sales and which led to many changes and need to adapt. Among the top industries affected are the automotive and aerospace industry, and service industries such as restaurants, hotels, etc.. Nevertheless, 2021 is a more hopeful year for most industries, including manufacturing.

The opportunities for the manufacturing industry in Mexico for this year

The pandemic challenged all industries, but it also presented an opportunity to analyze costs, ways of improvement, and to overcome changes. Which has led companies to search for alternatives, make better use of their resources and cut costs.

In which Mexico through its high skilled labor and competitive labor costs can play an important role.

Furthermore, the US and China trade conflict is still ongoing, as even though after several negotiations and that U.S. – China phase 1 trade deal was signed on January 13^th, it cut some U.S tariffs on Chinese goods in exchange of China agreement to expand purchases of certain US good and services and address some U.S objections on intellectual property practices. But still, some of the imposed tariffs remain unchanged.

Therefore, additionally to the abovementioned, the challenges caused by Covid-19, the increased labor costs in China and the rising tensions in the South China Sea, have raised concerns about manufacturing goods in China and shipping halfway around the world, leading some companies to reconsider where to set up operational manufacturing facilities, and to look for other options including onshoring or nearshoring.

In addition to the fact that the current travel restrictions between U.S. and China due to pandemic have complicated the situation.

Mexico plays an important role in this field, as in 2019 and 2020, Mexico overcame China to become U.S. number one trading partner, and many foreign manufacturing companies have decided to invest in Mexico and establish manufacturing operations in the last years.

Companies have been considering establishing manufacturing operations in Mexico due to the different advantages it offers such as:

Competitive labor costs
Highly skilled labor force
Proximity to US, which due to a similar time zone facilitate communication and travel and which leads to lower shipping costs.
13 Free trade Agreements with 50 countries
Foreign Trade and Tax Incentive Programs, such as the IMMEX Maquiladora Program.

The above-mentioned are some of the advantages Mexico has been offering for manufacturing companies in the last years and which will remain in 2021. These are some of the benefits that had led manufacturing in Mexico to rise in popularity in the last 2 decades.

Start Manufacturing Operations in Mexico in 2021

Are you looking to capitalize on the advantages of manufacturing in Mexico in 2021?

If you are looking to take advantage of the benefits Mexico offer for manufacturing companies, Mexcentrix can lead and support you in the complete process for establishing manufacturing operations in Mexico. Our shelter service offers full administrative and operational support including human resources, payroll, tax and accounting, foreign trade, customs, management IMMEX Program among others. Through our shelter program, our clients can focus on what they do best (production, quality, materials) and let us do what we do best.

Through Mexcentrix services, we ensure 100% compliance with Mexican law and regulations, and our clients can avoid unnecessary problems and costly mistakes. In addition, we offer ongoing consulting to keep our clients updated about any changes in applicable laws and regulations.

Furthermore, our specialized and highly qualified teams have helped our clients during these difficult times due to the pandemic, to implement measures designed to decrease the impact of the economic crisis in their operations and to be able to adapt in the most effective way.

For additional information regarding our services or if you need a cost model for your operations in Mexico, contact us.

What is IMMEX?

Immex stands for the Maquiladora, Manufacturing and Export Services Industry.

Benefits of the IMMEX Program

Categories of IMMEX program

IMMEX Holding Company Program:

IMMEX Industrial Program:

IMMEX Services Program:

IMMEX Shelter Program:

IMMEX Outsourcing Program:

How to take advantage of the benefits of the IMMEX program in Mexico

Mexcentrix can support your company in the full process since the application of the IMMEX program and management of it, including filing required reports and fulfilling all obligations.

What are Maquiladoras?

Benefits of Setting up a Maquiladora in Mexico:

Tax benefits:

Free Trade Agreements:

Cost Savings:

Location and Product Flexibility:

Fast and easy start-up through a shelter company:

How to establish a Maquiladora through a shelter company?

Through our shelter program, our clients can focus on what they do best (production, quality, materials) and let us do what we do best.

COMMERCIAL EDGE

The manufacturing industry is the main economic activity in the State of San Luis Potosi.

Why is San Luis Potosi one of the main manufacturing States in Mexico?

Some of the main advantages that make San Luis Potosí an attractive state for companies looking to establish manufacturing operations in Mexico are listed below:

Privileged geographical location

Supply Chain

Labor Force

Infrastructure

Due to the manufacturing advantages San Luis Potosi offers, several foreign companies have decided to establish manufacturing operations within the State.

Are you thinking of establishing manufacturing operations in San Luis Potosí?

Start your Mexico manufacturing operation successfully, with help from the experts.

Mexico presents advantages for manufacturing companies in 2021

The opportunities for the manufacturing industry in Mexico for this year

Companies have been considering establishing manufacturing operations in Mexico due to the different advantages it offers such as:

Are you looking to capitalize on the advantages of manufacturing in Mexico in 2021?

Mexcentrix will support your company for a smooth start and running of operations in Mexico.