| Meridia Industrial Profile |
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Merida is a good location for companies manufacturing products with high labor content in low tech industries such as apparel manufacturing. The city offers a stable labor force and lower manufacturing costs than other traditional "maquiladora" cities such as Cd Juarez, Tijuana or Reynosa. Nevertheless, long land distances make Merida less attractive for companies shipping time-sensitive items. View Larger Map
KEY INDUSTRIES
MAIN COMPANIES
ADVANTAGES
DISADVANTAGES
Overview Merida is a good location for companies manufacturing products with high labor content in low tech industries such as apparel manufacturing. The city offers a stable labor force and lower manufacturing costs than other traditional "maquiladora" cities such as Cd Juarez, Tijuana or Reynosa. Nevertheless, long land distances make Merida less attractive for companies shipping time-sensitive items. The City POPULATION Merida is the largest city of the state of Yucatan with a population of 705,055 people, which represents 42.5% of the total state population. The city is growing at a 2.45% annual rate, considerably higher than the national average of 1.8%. LOCATION Merida, the capital of the state of Yucatan, is situated to the north of Yucatan’s Peninsula only 20 minutes away from the Port of Progreso, which accesses the Gulf of Mexico. The city is located 200 miles west of Cancun and 900 miles east of Mexico City. The Yucatan Peninsula, located in southeastern Mexico, is a crossing point to the islands of the Caribbean and to Central America. The climate in Merida is hot and humid with summer rains. Average annual temperature ranges from 78° F in the winter to 90° F in the summer. The state has abundant fresh water resources. PROXIMITY TO IMPORTANT U.S. AND MEXICAN DESTINATIONS
INDUSTRY SNAPSHOT At the heart of the Mayan civilization, Yucatan is transforming itself from a tourist destination to an incipient industrial town. The Port of Progreso is one of the main seaports on the Gulf of Mexico and recently benefited from a USD $100 million expansion. Progreso is easily reached via a four-lane highway and has railway links. The Workforce DEMOGRAPHICS MERIDA : Distribution By Age Group Click Here To Register EMPLOYMENT CONSIDERATIONS UNEMPLOYMENT AND SUB-EMPLOYMENT SKILL LEVEL The skill level of the workforce is lower than that found at border cities and major industrial centers like Monterrey and Guadalajara. Both the city and the state are almost completely dedicated to the tourism sector, although manufacturing activity has grown during the last few years, especially in the apparel assembly sector. EDUCATION and TRAINING Merida has an adequate educational infrastructure with 97 high schools and 16 universities offering several undergraduate and graduate degrees. Additionally, there are 105 institutions that offer technical specialization and job training programs. The main higher education institutions include:
Merida has an illiteracy rate of 4.7% of the population over 15 years of age, which compares favorably to the national average of 9.5%. TURNOVER RATES Merida benefits from very low employee absenteeism and turnover rates. We estimate turnover rates in the neighborhood of 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 that any company moving into Mexico will consider. TeamNAFTA touches on the overall wage issues in our Info Center but we have also provided some sample wages for Merida 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. U.S. dollars/hr. includes all mandatory and average optional benefits for this market
(Source: Area industry wage studies and interviews with local managers, $11.00 pesos/USD) INDUSTRIAL COSTS dollar @ 11 pesos/USD
*CFE.-June 2004, ** CRE.-June 2004, *** Pemex June 2004 INDUSTRIAL REAL ESTATE The state government is committed to capital improvements and modernization to industrial areas, its basic infrastructure includes:
(Source: MaquilaPortal) There are two industrial parks in Merida: the Yucatan Industrial City and the Merida Industrial Park. Both industrial parks offer all services necessary for manufacturing including water, electricity, natural gas and fiber optic telephone services. AVAILABLE SPACE A current survey of industrial parks in Merida, with a variety of site options, reveals the following average prices in US dollars per sq. ft. Industrial Real Estate US dollars/sq. ft.
TRANSPORTATION Highways The State of Yucatan has 5,566 miles of modern highways, including the Merida-Progreso highway, a center for industrial and commercial development that provides access to the Port of Progreso. Import/export freight arriving to the Port is shipped over an extensive system of highways to Mexico City and other southern states including Campeche, Quintana Roo, Tabasco, Chiapas, and Oaxaca among others. The most important highways that link Merida with the rest of the country include:
Port of Progreso Progreso, 20 miles north of Merida, is Yucatan’s deepwater port. The port has the personnel as well as the equipment necessary for loading and unloading containers, cartons and bulk products. Transit time from Progreso to US ports in Louisiana (New Orleans) and Florida (Miami or Jacksonville) is approximately 2.5 days, and several shipping lines offer weekly service. Railways There are about 376 miles of highways in Yucatan including a central station in Merida that provides service to the Merida-Progreso region as well as to the US and Canada. Air Transportation The Merida International Airport provides air service with over 500 weekly flights to major American and Mexican destinations. This airport offers scheduled domestic and international flights and freight service provided through Aerocalifornia, Aerolitoral, Aeromar and Mexicana among others. CUSTOMS Mexican customs operates facilities at the Merida international airport and at the port of Progreso. Some of the services offered at the Progreso 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 YUCATAN INCENTIVES The State Government covers worker training costs for a period of time (a minimum of one month, a maximum of three months) valued at 1.5 minimum wages per person. Additionally, the “Moving to the South “ program, which is a federal government trust fund, assists investors in start-ups and expansion of operations, especially in personnel training and infrastructure development. (Source:Bancomext) Sectors offering special opportunities include: Auto-Parts, Furniture, Electric/Electronic Components, Home Appliances, Jewelry, Shoes and Leather Goods, Toys and Apparel Manufacturing. The Support SUPPORT SERVICE COMPANIES The support service infrastructure in Merida continues to grow, but companies still face some challenges finding reliable local suppliers. Careful review of the city’s capabilities on essential inputs and support services is required before committing an operation. For maritime transport, container and general cargo service from the Port of Progreso is scheduled to New Orleans, three times per week and to Miami once per week. Scheduled and charter airfreight services are available, as well as air courier service. Other support services available include banking, tax/accounting, legal, and customs brokerage. The Politics UNIONS Unions are less active and influential than in the northern or central parts of Mexico. Unionized labor has not been an impediment for maquila plants in Yucatan. 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 mayor for the city of Merida, Mr. Manuel Fuentes Alcocer is a pro-business leader. The government supports the development of the maquila industry through facilitating housing and educational programs. These programs provide affordable housing near plant sites and other training services to future employees. Day care facilities offer free services to working mothers with children under the age of four. The State’s Secretary of Ecology is responsible for authorizing most industrial permits. |
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