| Monterrey Industrial Profile |
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KEY INDUSTRIES
MAIN COMPANIES
ADVANTAGES
DISADVANTAGES
Overview Monterrey is the industrial leader of Mexico and Latin America. The area is home to the nation's largest iron and steel foundries, a major cement producer and home to world-class financial service institutions. While it is home to a top-notch manufacturing base, this high level often scares off new companies looking for lower cost manufacturing opportunities. According to Fortune Magazine, Monterrey is the best city in Latin-America to do business due to its geographical location, industrial development and entrepreneurial, progress-oriented culture. The City POPULATION
Monterrey is both Mexico’s third largest city and the biggest metropolitan area in northern Mexico. The Monterrey Metropolitan area includes the City of Monterrey as well as the adjacent towns of Apodaca, Garcia, San Pedro Garza Garcia, San Nicolas de los Garza, Guadalupe, Escobedo, Juarez, and Santa Catarina. The Monterrey metro area has a population of 3,664,334 people that is growing at an annual growth rate of 2.17%. This population represents 83.3% of the population of the State of Nuevo Leon. LOCATION Monterrey, capital of the State of Nuevo Leon, is located in the northeastern Mexico. The State of Nuevo Leon borders with Tamaulipas to the north and east, with Chihuahua to the west, and with San Luis Potosi to the south. It also shares a small border with Texas. Monterrey is surrounded by mountains, and is home to the “Cerro de la Silla” hill, which is considered to be an icon of the city. Monterrey's weather is pleasant during fall and winter, and hot and humid during spring and summer. The average temperature by season is as follows:
PROXIMITY TO KEY CITIES
INDUSTRY SNAPSHOT Nuevo Leon is one of Mexico's leading industrial states, with a GDP of US $48 billion. Its business base consists of 13,251 manufacturing companies, and 51,028 services firms. Greater Monterrey accounts for about 95 % of the State of Nuevo Leon’s GDP and is the financial center of northern Mexico and second only to Mexico City in its industrialization activity. Fortune Magazine has consistently recognized Monterrey as one of the best cities in Latin America to do business. Monterrey has a diversified industry which includes the production of iron and steel, glass, cement, plastics, chemicals, and other industrial products. Its export activity has increased during the last few years, especially for glass and automotive accessories. It is important to note that Monterrey accounts for 18% of Mexico’s manufacturing exports. A key export sector, electrical products and components, constitute 35% of total exports of the metro area and include products such as automotive harnesses (Alcoa Fujikura and Delphi), electrical condensers (Kemet), electrical motors, electrical consoles and panels (GE), telephone devises (Celestica), and copper wires (Phelps Dodge and Magnekon), among others. With regard to the maquiladora industry, it has experienced continuous growth. Currently, there are 176 maquila plants in the Monterrey Metro Area, which employ 55,622 people. The Workforce DEMOGRAPHICS Source: 2004 INEGI - February 20081 AGE DISTRIBUTION Click Here To Register MONTERREY: Distribution By Age Group Source: 2004 INEGI - February 20081 {else} Click Here To Register {endif} LABOR AND EMPLOYMENT UNEMPLOYMENT AND SUB-EMPLOYMENT SKILL LEVEL Monterrey has some of the best professionals and most skilled workers in Mexico. In fact, most workers are third and fourth generation factory workers, given the long-standing industrial activity in the city. Monterrey is Mexico's most productive industrial city per capita; its productivity is about 33% higher than the national average. The city inhabitants are known for having a culture that values hard work, self-reliance and entrepreneurship. EDUCATION AND TRAINING Monterrey is famous for its world-class educational institutions, including its flagship university, the Tec of Monterrey as well as the University of Nuevo Leon, and the University of Monterrey among others. The Tec of Monterrey is recognized internationally for the quality of its educational programs, and for the excellence of its graduates and is one of the top institutions of higher learning in Latin America. It is important to highlight that over 60% of Nuevo Leon’s annual budget is spent on education. In total, the city has 25 universities and 231 technical schools. There are 125,000 high school, 117,614 undergraduate, and 10,655 graduate students as well as 47,300 students in job training programs for the 2003-2004 academic year. The government of Nuevo Leon, in coordination with several public and private organizations, offers permanent training programs in areas such as productivity, quality and customer service. (Source: Ministry of Public Education, and the Nuevo Leon Government) TURNOVER RATES Monterrey has become an attractive site for the maquila industry given its relatively low turnover rates and stable labor force. The economic development department of Nuevo Leon does not have a published figure but we estimate the rate to be 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 Monterrey 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.
Source: Area industry wage studies and interviews with local managers, $11.00 pesos/USD
*CFE.-June 2004, ** Pemex.-June 2004, *** Comision Nacional del Agua.-June 2004 INDUSTRIAL REAL ESTATE Monterrey benefits from a myriad industries and modern infrastructure. Its International Business Center, also known as Cintermex, is one of the most important convention centers in North America. The 700,000 sq ft center provides 30,000 sq feet for meetings and conventions and 100,000 sq feet for fairs and expositions. There are 35 Industrial Parks in the Metropolitan Area of Monterrey: Industrial Parks in the Municipality of Apodaca:
Industrial Parks in the Municipality of Escobedo:
Industrial Parks in the Municipality of Guadalupe
Industrial Parks in the Municipality of Sta. Catarina
Industrial Parks in other Municipalities
AVAILABLE SPACE Industrial parks in Monterrey offer all services necessary for manufacturing including water, electricity, natural gas and fiber optic telephone services. A current survey of industrial parks in the Monterrey Metropolitan Area, with a variety of site options, reveals the following average prices in US dollars per sq. ft.
TRANSPORTATION The State of Nuevo Leon has an excellent 4,588 miles highway system. To the north, it connects with Laredo, TX, which is the closest border crossing point from Monterrey leading to the vast North American market. Highways are in excellent condition, tough they experience some heavy traffic, in particular Federal Highway 57.
The recently opened International Bridge of Colombia provides quick access to the U.S. About 286,015 loaded trucks cross northbound to the U.S. every year with a similar number crossing southbound to Mexico. Monterrey accesses the central eastern NAFTA corridor and its two branches: the urban and the rural corridors, as well as to the Atlantic corridor.
(Source: NAFINA, North American Forum on Integration) There are 2 International airports in Monterrey, the Mariano Escobedo International Airport located 30 minutes from downtown, which offers 250 daily flights, and the Del Norte Airport, with 94 daily flights. The railroad network in Nuevo Leon has an extension of 679 miles. CUSTOMS Mexican Customs has facilities at both the Colombia International Bridge and in city of Monterrey while US Customs processes imports through Laredo TX, which has many competent customs brokerage firms ensuring efficient, timely crossings. In fact, Laredo has more licensed U.S. Customhouse Brokers than any other border city. 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 NUEVO LEON INCENTIVES: Fiscal
Labor
Economic:
Source: Bancomext 2006 The Support SUPPORT SERVICE COMPANIES Nuevo Leon offers several advantages to manufacturing companies with a network of over 30,000 suppliers and service companies that offer shelter services, components production, and logistic services. Its relative proximity to the U.S. provides access to U.S. suppliers. It is important to highlight that service and support companies in Monterrey offer services similar in quality to its U.S. counterparts given both its geographical and cultural proximity to the U.S. The Politics UNIONS Even tough unions are present in Monterrey, they are generally pro-business and cooperative with management and help recruit new employees. About 43% of the workforce is unionized. Together, the Mexican Confederation of Workers (CTM) and the Revolutionary Confederation of Workers and Farmers (CROC) account for about 30% of unionized workers in Monterrey. The rest, about 70%, are members of independent unions. POLITICAL INFLUENCES The governments of the State of Nuevo Leon, and the Municipalities of Monterrey and its surrounding areas have focused their emphasis on bringing Foreign Direct Investment to the city. Several Industrial Parks have been built during the last few years and big investments are planned in highways, railroads and telecommunications. Industrial Market Map 1 The INEGI makes his Economic Census every five years. The last Census took place in 2004 (next one to be in 2009).
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