| Culiacan Industrial Profile |
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To the point, Culiacan is not an industrial Mecca. Any medium or large manufacturing operation will have to develop the plant from the ground up. For companies looking to take advantage of a beautiful city and lack of competition Culiacan might be an interesting choice. However, be prepared for a Greenfield operation all the way. It would be difficult to advise companies lacking significant experience in Mexico on moving to Culiacan. View Larger Map
KEY INDUSTRIES
MAIN COMPANIES
ADVANTAGES
DISADVANTAGES
Overview To the point, Culiacan is not an industrial Mecca. Any medium or large manufacturing operation will have to develop the plant from the ground up. For companies looking to take advantage of a beautiful city and lack of competition Culiacan might be an interesting choice. However, be prepared for a Greenfield operation all the way. It would be difficult to advise companies lacking significant experience in Mexico on moving to Culiacan. The City POPULATION
Culiacan is the largest city in the state of Sinaloa with a population of 745,537 individuals, 49.23% male and 50.77% female. The population is growing at a 1.6% annual rate, just below the 1.8% national growth rate. The population in the city accounts for 29% of total state’s 2,570,817 inhabitants. LOCATION Culiacan is located in the central western part of the State of Sinaloa, which is located in northern western Mexico. Sinaloa borders with the states of Sonora and Chihuahua to the north, Durango to the east and Nayarit to the south. It shares 400 miles of coastline with the Pacific Ocean and the Sea of Cortez to the west. The city has an elevation of 173 feet and an average annual precipitation of 25 inches. The annual average temperature is 85°F. The heat season starts from March through October where temperatures can reach 140°F with occasional showers in the afternoons. The winter is pleasant, mild and short in duration, running from November to December with average temperatures of in the 60’s.
PROXIMITY TO KEY CITIES
INDUSTRY SNAPSHOT Culiacan accounts for 32.5% of total industrial activity in the State of Sinaloa. Many products to be exported to the U.S. west coast from Mexico transit Culiacan’s territory, which serves as a natural pass west of the Sierra Madre Occidental mountain range. The city hosts three primary industries: textile, agro industry and food processing. Culiacan has a rich harvesting valley with a modern water infrastructure composed by several high-scale dams. Most of the agricultural production is exported to the U.S. Fishing and livestock play an important role in Culiacan’s economy, creating a significant proportion of the city’s total employment. It is important to note that Sinaloa is Mexico's second leading vegetable and cereal producer and is the country's most important fishery center. Three quarters of the state are devoted to agricultural production: rice, sugarcane, wheat, vegetables, and fruits. Fishing (sardine, oyster, shark, anchovy) is also important and one of the state's main sources of foreign exchange. There are several mineral-rich zones with potential for gold, silver, copper, lead, and zinc. (Source: Industry Canada and Statistics Department. Secretariat of Economic Development) The Workforce DEMOGRAPHICS AGE DISTRIBUTION CULIACAN: Distribution By Age Group Click Here To Register LABOR AND EMPLOYMENT The city’s growing population results in lower employee turnover. The employment in Culiacan by sector is as follows: Culiacan, Employment by Sector
(Source, INEGI 2004) UNEMPLOYMENT AND SUB-EMPLOYMENT SKILL LEVEL The skill level of workers in Culiacan is expected to be lower than that found at border locations and major industrial centers like Monterrey and Guadalajara. The city is mainly dedicated to agricultural, livestock and fishing activities. The few maquiladora operations in Culiacan are focused on apparel assembly. EDUCATION and TRAINING PROGRAMS Culiacan has an adequate educational infrastructure. There are 65 high schools and 17 universities which offer postgraduate degrees as well as 30 institutions that offer technical specialization and job training programs. The main higher education institutions include:
(Source: SEP 2003) TURNOVER RATES Culiacan has a reputation for harmonious labor relations. Turnover rates are low when compared with the rest of the country and usually run Click Here To Register The Operation WAGE RATES Wages are the key driver of Mexico’s manufacturing industry. It is, therefore, one of the first and most important topics any company expanding in Mexico will consider. TeamNAFTA touches on the overall wage issues in our Info Center, but we have also provided some sample wages for Culiacan below. While we have access to more detailed wage information, we typically present that information in a tailored report addressing a company’s specific labor needs.
Average hourly wages paid in Culiacan: 2003 - 2004
Source: Area industry wage studies and interviews with local managers, $11.00 pesos/USD INDUSTRIAL COSTS dollar @ 11 pesos/USD
*CFE.-June 2004, ** Pemex.-June 2004, *** Comision Nacional del Agua.-June 2004 INDUSTRIAL REAL ESTATE Culiacan does not pose a threat to the established manufacturing centers around Mexico. It has a small industrial base and is, at best, considered a tertiary maquiladora market. There is one industrial park within the planned community La Primavera, but the services and location poise serious problems. Basically, any significant real estate project in Culiacan will be a greenfield development operation. TRANSPORTATION Highways Culiacan benefits from a central location situated between west-central Mexico and the U.S. border. Culiacan has an advanced highway network; including a four-lane highway direct to the US.
Given, its Location, Culiacan provides quick access to two NAFTA corridors:
Maritime Transportation The city has excellent access to the U.S. west coast via ship transport through the ports of Los Mochis and Mazatlan on the Pacific Ocean. Railroads The railroad network connects Sinaloa with the rest of Mexico as well as key cities in the US such as San Diego, Nogales, and Dallas. The Culiacan railroad station is part of the Pacific-Chihuahua rail line, which connects to the rest of the country’s national railroad system, including the Mexican ports of both the Atlantic and Pacific Ocean Air Transportation The Culiacan International Airport offers scheduled domestic and international flights and freight service provided through Aerocalifornia, Aerolitoral, Aeromar and Mexicana to several US and Mexican destinations. CUSTOMS A fully staffed customs office is located in the city of Culiacan. Trucks can clear customs here and avoid delays at the U.S. border. Some of the services offered at the Culiacan customs office include:
INCENTIVES The government offers incentives in relation to payroll taxes, training programs, and assistance in the procedures for meeting requirements at three levels of government (federal, state, and municipal). Additional incentives can be negotiated, depending on the location of the new project, type of manufacturing activity, and the creation of jobs. The incentives subject to negotiation include: infrastructure works, fees with the State Public Registry, and construction permits. STATE OF CULIACAN INCENTIVES
Sectors offering special opportunities: Automotive, Auto Parts, Aerospace, Mechanical Metallurgy, Electronics, Software The Support SUPPORT SERVICE COMPANIES The support service infrastructure in Culiacan continues to grow, but companies still face some challenges finding reliable local suppliers. Most of the maquiladoras in Sinaloa are either textile or agro-industry based operations.Professional services in accounting, legal services, customs brokerage, construction, environmental and real estate brokerage are available in the city. Additionally, there are 8 different companies in Sinaloa that offer international cargo service to the United States. Nevertheless, careful review of the city’s capabilities on essential inputs and support services is required before committing an operation in Culiacan. The Politics UNIONS Culiacan has a long standing reputation for harmonious labor relations. Statistics show that in the last 5 years there has only been one strike with a favorable resolution for both parties. Unions in the city are flexible and cooperative with management and help recruit new employees. When companies start operations, they meet with union representatives and make an agreement. This process aids in protecting the interests of both management and the workforce. Some of the labor unions that have presence include: the National Union of Workers (UNT), the highly centralized Mexican Workers' Confederation (CTM), and the Revolutionary Confederation of Workers and Farmers (CROC) among others. POLITICAL INFLUENCES The Governor of Sinaloa, Mr. Juan S. Millan, from the right wing PRI party supports the development of the maquila industry (in-bond manufacturing) through housing and educational programs. These programs provide affordable housing near plant sites and other training services to potential employees and prospective employers. OTHER COMPANIES IN Culiacan
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