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KEY INDUSTRIES

• Auto and Auto Parts
• Textile
• Chemical
• Cement
• Furniture

MAIN COMPANIES

ADVANTAGES

• Diversified economic base with growth rates above the national average
• Excellent transportation infrastructure and proximity to Mexico City
• Close to the Gulf port of Veracruz
• Abundant and stable labor force
• Good quality of life

DISADVANTAGES

• Considerable distance from the border
• Lack of support for industries other than automotive and textile/apparel
• The VW plant pays the highest wages and attracts the best workers

Overview

Although Puebla is not a strong maquila market due to its distance from the border, it is Mexico's fourth largest city and home to the Volkswagen plant, one of the largest automobile assembly plants in the country, which employs over 7,000 people and produces nearly 15,000 cars annually. Aside from the large Volkswagen industrial complex and its supply chain, most maquilas in Puebla are smaller shops employing workers in the textile and apparel industries. 

The City 

POPULATION

Puebla, the capital city of the state with the same name, has an estimated population of 1.35 million people that is growing at a 2.1% annual rate, faster than the national growth rate of 1.8%. The Puebla urban area includes 33 municipalities where more than 2.2 million people live; this population represents 26.3% of the state’s population of 5.14 million individuals.
(Source INEGI 2000)

LOCATION

The city of Puebla is located in central-south Mexico, 76 miles southeast of Mexico City at an elevation of 7,091 ft. The State of Puebla borders Tlaxcala and Hidalgo to the north, Veracruz to the East, Morelos and the State of Mexico to the West, and Guerrero and Oaxaca to the South. It is one of the most important industrial centers of the central region of Mexico, and a crossroad for most of the industrial output that is exported to Europe via the port of Veracruz, as well as a linking point between Mexico City and the southern region of the country.

The climate is mild and pleasant with the following average temperatures:

PROXIMITY TO IMPORTANT U.S. AND MEXICAN DESTINATIONS

INDUSTRY SNAPSHOT

Puebla is one of the most important industrial cities in central Mexico thanks to its privileged geographical location, skilled workforce and dedicated private sector which supports industrial development. The city has greatly benefited from its proximity to both Mexico City and the port of Veracruz.

Foreign investment in the state of Puebla has grown steadily, reaching 725 million USD in 2001. Germany is the main investor with 48% of the total, followed by the U.S. with 13% and South Korea with 9%. The rest comes from Canada, England, France, Spain, Sweden, and other European countries. In total, maquila exports in the state of Puebla totaled $434 million USD in 2002.
(Ministry of Economy)

The city's industrial activity is centered on the automotive, food processing, textile, and chemical industries, which have created a strong support and service base. The main manufacturing sectors in Puebla are the following:

(Source: INEGI)

The large Volkswagen manufacturing plant has attracted related industries to the city. The VW plant exports 80% of its production, most of which goes to the U.S. and it is the only plant which produces the New Beetle for export to the United States, Europe and Japan. In 2004 the VW plant is set to produce 235,000 vehicles. This is a decline from recent years as demand in the U.S. slipped. 

DEMOGRAPHICS

A considerable percentage of Puebla’s inhabitants are 19 years old or younger. This will ensure that the area continues to have new workers entering the labor pool for years to come, aided by the flow of people emigrating from rural areas. More than half of the population is of working age, while the elderly population represents less than 5% of the city’s inhabitants.

PUEBLA : Distribution By Age Group Click Here To Register

EMPLOYMENT CONSIDERATIONS

The economically active population in the City Puebla is 555,581 individuals, or 53.99% of the total population over 12 years old. There is a big difference between the percentage of men and women that participate in productive activities: 72.4% of men are economically active while only 37.9% of women are.
(INEGI 2004)

The manufacturing industry in the state of Puebla employs 380,571 workers, of which 24,055 work in the maquiladora industry. In recent years the export industry has become one of the main sources of employment in the state.

Puebla’s largest employer is Germany’s Volkswagen Automotive Company, the biggest auto plant in Mexico, which produces nearly 15,000 vehicles per day, and employs about 12,000 people, 10,300 of which are unionized. The VW plant in Mexico is the third most important plant in Volkswagen's worldwide. Altogether, VW and its parts suppliers employ 100,000 people in 85 auto parts plants. The VW plant is also the largest employer in the state of Puebla, accounting for 60% of all manufacturing and 40 % of all exports of the State.

UNEMPLOYMENT AND SUB-EMPLOYMENT

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SKILL LEVEL

The quality ranking of workers in Puebla is high, especially in the automotive sector due to Volkswagen and its training institute. The workforce is also very competitive in the textile and apparel industries, as well as in the automotive supplies sector.

EDUCATION and TRAINING PROGRAMS

In Puebla, education is valued very highly and the government has invested heavily to improve the educational system. In fact, the State of Puebla occupies the 2nd place nationally in educational infrastructure with more than 118,000 students. The city of Puebla, in particular, offers excellent educational opportunities with over 20 universities, and 71 technical schools. Some companies like Volkswagen offer word-class training programs. The company has its own Institute to train workers and executives in a broad range of disciplines such as:

• Leadership
• Executive education
• Total quality control
• Kanban and JIT inventory systems
• Finance
• Electronics
• Hydraulics
• Languages: Spanish, English and German
• Technical specialties for Machine Shop workers based on the German education model

TURNOVER RATES

The state’s economic development department does not have a published figure but we estimate the rate to Click Here To Register