| San Luis Potosi Industrial Profile |
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KEY INDUSTRIES
MAIN COMPANIES
ADVANTAGES
DISADVANTAGES
Overview San Luis Potosi has been one of Mexico’s bright spots over the past three years. Although it is a small market, it is home to some of the largest and fastest growing manufacturing companies in the country. San Luis Potosi is centrally located along the NAFTA Highway mid-way between Mexico City and the border and has good access to the major ocean ports on both coasts. The city has abundant industrial land and a dedicated, although slightly under skilled, labor pool. Recent growth has made San Luis an institutional real estate market and its small size does not prohibit it from being considered a tier 1 market in Mexico. The City POPULATION San Luis Potosi has a population of 743,710 people, which represents 36% of the total state population. The annual growth rate is 2.48%, above the national average of 1.8%. It is interesting to note that 75% of Mexico’s population resides within a 300 mile radius of the city. (Note: Annual Growth Rate for the 1990-2000 period) (Source: Secretariat of Economic Development and State Government estimates) LOCATION San Luis Potosi, capital of the State with the same name, is located in the geographical center of Mexico. San Luis Potosi borders Tamaulipas and Nuevo Leon to the north, Veracruz to the East, Hidalgo, Queretaro, and Guanajuato to the south and Zacatecas the west. San Luis Potosi is one of Mexico’s key transportation hubs, sitting equal distances from Monterrey, Guadalajara and Mexico City. It is also located between the two coasts, with good access to the international ports of Manzanillo and Tampico on the Pacific and Atlantic Ocean respectively. The city’s main industrial area sits directly on the NAFTA highway only 7 1/2 hours away from Laredo and 5 hours away from Mexico City. San Luis Potosi is located at an altitude of 6,102 feet above sea level. The city enjoys a warm & generally dry weather. Because of its altitude, the climate is spring-like all year. Temperatures range from 98° F to 56° F in the summer and 80° F to 34° F in winter. Average relative humidity is 35%. INDUSTRY SNAPSHOT San Luis Potosi's location along the main transportation corridor of Mexico has produced increased industry diversification and strong economic growth. Its industrial activity originally developed in the mining and agricultural sectors with recent emphasis in commerce and trade. The leading manufacturing activities include the automotive, metal and mechanical industries, food processing, and textiles. While the state of San Luis Potosi is large, most of the commercial and manufacturing industry is located in the capital city. PROXIMITY TO KEY CITIES San Luis is approximately an 8 hour drive from Laredo, Texas and centrally located vis-à-vis Mexico’s major industrial markets. Refer to the following table for distances to the main US and Mexican locations.
The Workforce DEMOGRAPHICS Click Here To Register AGE DISTRIBUTION Click Here To Register LABOR AND EMPLOYMENT UNEMPLOYMENT AND SUB-EMPLOYMENT SKILL LEVEL AND EDUCATION The workforce in San Luis has expertise in the automotive, food processing, metallurgic and textile industries; however, in general, the skill level of the workforce is about average when compared to the national level. The city possesses an adequate training and educational infrastructure. There are 102 high schools, 44 job training facilities, and 9 universities in the state. About 95.8% of the population over 15 years is literate. TURNOVER RATES San Luis Potosi benefits from relatively low turnover rates and a stable labor force, a consequence of the high sub employment rates and limited industrial activity, as well as its distance from the border. Official estimates show Click Here To Register |
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Source: Area industry wage studies and interviews with local managers, $11.00 pesos/USD
INDUSTRIAL COSTS dollar @ 11 pesos/USD
| Electricity (H-M rate over 100 Kw): | Click Here To Register |
| Natural gas: | Click Here To Register |
| Water | Click Here To Register |
*CFE.-June 2004, ** CRE.-June 2004, *** Pemex June 2004
INDUSTRIAL REAL ESTATE
AVAILABLE SPACE
Two major industrial parks serve San Luis Potosi: Tres Naciones and Millennium. They are both located in the larger industrial zone sitting on the NAFTA highway leading southeast towards Queretaro and Mexico City. Both parks have good infrastructure and available land, although Tres Naciones is the larger of the two. These industrial parks have ample electricity, water, drainage systems, natural gas and fiber optic telecommunication services. The centralization of manufacturing operations in the industrial zone of San Luis Potosi is seen as a negative for many companies investigating the area due to perceived turnover issues. While this might be true, the concentration also makes it easier for employee transportation and accessibility to utilities.
A current survey of industrial parks with a variety of site options reveals the following average prices in U.S. dollars per sq. ft. for Class “A” construction
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TRANSPORTATION
San Luis Potosi benefits from a central location, located between central Mexico and the U.S. border. To the north, the city connects with Saltillo, Coahuila and Monterrey via Federal Highway 57. To the East, it links with Ciudad Valles and Tampico via Federal Highway 10 while Federal Highway 57 provides access to southern cities like Queretaro and Mexico City, and to western destinations like Guadalajara.
Given its central location, San Luis has access to the three main NAFTA corridors.
- The Pacific corridor communicates with the entire geographic band formed by the Rocky Mountain range and the Pacific coast.
- The central western corridor includes the largest concentration of maquiladoras and the 2nd largest trade volumes of all the North American corridors, connecting to Chihuahua, El Paso, Denver, Las Vegas and Edmonton.
- The eastern corridor which passes through the largest North American cities and the industrial basins of the central eastern region, as well as through the Great Plains in the U.S. and through the Canadian Prairies
The city has excellent access to the U.S. East and Gulf coasts via ship transport through Tampico and Altamira on the Gulf of Mexico. The railway service also links to the Mexican ports of both the Atlantic and Pacific Ocean. Regular service is provided to Miami, New Orleans and Houston from Altamira. A modern inter-modal container port (under construction) will contribute to strengthening the transportation network.
The San Luis Potosi airport offers scheduled domestic and international flights and freight service provided through Aerocalifornia, Aerolitoral, Aeromar and Mexicana to several Mexican and US destinations.
CUSTOMS
A fully staffed customs office is located in the city of San Luis Potosi. Trucks can clear customs here and avoid delays at the U.S. border. Some of the services offered at the San Luis Potosi customs office include:
- Definite imports and exports
- Temporary imports and exports
- Fiscal deposit, for storing of merchandise in authorized general deposit storages under customs authority control
- The transit of merchandise
- Quality System ISO 9000
- Merchandise dispatching
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 SAN LUIS POTOSI INCENTIVES
- Total exemption of the Tax on Pay-Roll for up to 4 years
- Exemption on the payments of the inscription rights in the Public Property Registry of 25% to 60% for industrial companies
- Training scholarships through the State Employment Service
LOCAL, MUNICIPALITY INCENTIVES
- 50% exemption off the Real-estate Tax and the Official Land Register services' rights
- 50% exemption off the Landlord Transaction Tax on Real-estate
- 50% exemption off the municipal public lighting services' rights
- Assistance in paperwork and 50% exemption off the payment for the municipal right of recollection, treatment and final disposal of domestic solid waste
The Support
SUPPORT SERVICE COMPANIES
The city of San Luis Potosi has limited manufacturing support services.
- A company ordering a truck can expect to receive it in San Luis Potosi by the following day
- Railway transportation may be the choice when production schedules allow for longer transportation time
- The city has an inter-modal port allowing for double-stacking logistics
The Politics
UNIONS
There are three main unions: C.T.M., C.R.O.C., and C.R.O.M. in San Luis Potosi. Unions in the city are flexible and cooperative with management and help recruit new employees. When companies start operations in San Luis, they meet with union representatives and make an agreement. This process helps in protecting both management and labor.
POLITICAL INFLUENCES
The state government assists with the process of establishing businesses in San Luis Potosi by offering state land at competitive prices, providing on-going support and streamlining the license and permitting processing.
MAJOR AUTOPARTS COMPANIES AND THEIR PRIMARY PRODUCTS
| Company | Product |
| Click Here To Register | Die Casting and Stamped Parts |
| Click Here To Register | Reman Starters & Alternators |
| Click Here To Register | Transmissions for Trucks |
| Click Here To Register | Hinges |
| Click Here To Register | Pulleys, Brackets, Flywheels |
| Click Here To Register | Tires |
| Click Here To Register | Belts |
| Click Here To Register | Clutch and Braking Systems |
| Click Here To Register | Alternators & Starters |
| Click Here To Register | Braking Systems |
| Click Here To Register | Diesel Engines and Tractors |
| Click Here To Register | Gray Iron Casting |
| Click Here To Register | Electrical Systems |
| Click Here To Register | Radiators, Electric Motors, Oil Coolers & Heaters |