UK Manufacturing Sector Outsourcing To Mexico | NAPS
May 4, 2015
The Best Is Yet to Come for Britain and for Mexico
Mexico and Britain seem to be unlikely allies, located half a world apart with very different cultures. However, Britain and Mexico share a close and growing bond over finance and free trade.
The United Kingdom has joined many nations in using Mexico as a site of low cost manufacturing. A recent report found that Mexico manufacturing is less expensive than that found in China and several other nations that are associated with the business. Today, Britain is the seventh largest investor in Mexico and its sixth largest trading parter. More than 1,500 companies based in the UK choose Mexico for manufacturing.
A Rising Star in Manufacturing
Many global companies are investing in Mexico due to an ample skilled workforce and low regulations. Large technology manufacturing plants such as Sharp have moved operations to Mexico from Asia. This is an excellent financial move for many companies, as manufacturing is four percent cheaper in Mexico than in China. As a result, exports of electronics from this Latin American nation have grown three times over in less than a decade, now totally around $78 billion.
A Shift in Global Manufacturing
There have been immense changes in global manufacturing just in the past few years. Many countries traditionally associated with low cost manufacturing, such as China, Brazil, and Russia, are no longer a bargain. Mexico, meanwhile, has a government and tax structure that is incredibly friendly to the manufacturing sector and a workforce eager to take these jobs. In addition, Mexico has spent a decade investing in the infrastructure necessary to take the manufacturing world by storm.
Companies that are quick to change manufacturing location will benefit from moving to Mexico. Not only is Mexico less expensive than many manufacturing locations in Asia, it is closer to the UK. This can lower overall costs even further. Mexico is already gaining ground in the manufacturing sector with its neighbors Canada and the United States.
The Future of Trade Between Britain and Mexico
The Mexican president recently visited the UK and spoke about the growing strength of the trade relationship between the nations. In addition, corporate leaders from both countries have been meeting to discuss ways to mutually benefit from trade. These symbiotic relationships can strengthen both individual businesses and the nations as a whole. The future of Mexico manufacturing appears to be bright, especially when it comes to manufacturing for British companies.
As the manufacturing relationship between Mexico and Britain grows, so have other relationships. Tourism from Britain to Mexico has grown ten percent in the past year, with Britain now sending more vacationers to the country than any country except for the United States and Canada. Mexico and Britain appear to be forging a business alliance that is built to last.