A Diverse Aerospace Portfolio to Help SMEsBy Sofía Hanna | Tue, 07/27/2021 - 11:39
Q: How is FUMEC supporting SMEs in the aerospace sector?
A: FUMEC, a non-profit NGO created in 1992 with the support of organizations in the US and Mexico, aims to support the design and promotion of high-impact programs that promote the development of value ecosystems for regions and sectors that are of mutual interest to Mexico and the US. We use science and technology to support economic and social development based on innovation.
The aerospace industry requires the use of high-end technology and Mexico has done a great job in catching up and finding opportunities. FUMEC offers a series of programs to support SMEs. Our role is to equip them with technological tools that will allow them to enter global value chains.
Q: What role do SMEs play in the aerospace industry and how can they support the sector’s recovery?
A: SMEs play an essential role in Mexico’s economy because about 85 percent of employment is generated by these companies. It is the same for the manufacturing sector. The recovery of the aerospace industry does not depend only on the strategies developed by OEMs, Tier 1s and Tier 2s. It requires the participation of SMEs, which provide a large part of the labor, development, engineering and supplies. Global supply chains were disrupted by the pandemic and the trade war between China and the US. Companies must now understand what is happening to prepare themselves. Large companies are prepared, which is why we are interested in helping SMEs.
Q: How have you helped to drive the sector forward with your global network of allies?
A: Our global network allows us to help SMEs. Fifteen years ago, we created a program to help companies every step of the way, from soft-landing to operational strategy development. We have developed a strong network comprised of aerospace experts, support companies and OEMs. To convey the capabilities of SMEs and make sure they deliver, we provide them with high-end consultants to lead them through every necessary process. We have experts in the US, Spain, Canada and Germany who can match the needs of any SME.
Q: How is FUMEC collaborating with Mexican aeroclusters to support the development of the sector?
A: We have allied with some of the main aeroclusters in Mexico, which help us to incorporate new members into our programs. We work especially with the clusters in Chihuahua, Nuevo Leon and Queretaro. When these clusters need training programs, experts, or support through the migration process, they contact us and we provide them the tools they need. It is better to put together a group of companies and guide them at the same time, rather than doing it individually. We started creating groups in 2019 and this new scheme led to great success cases and a reduction of the costs and time involved in signing a contract. In the past, this process would take three to five years but now it only takes one or two years. We are shortening the time periods these companies need to be successful.
Q: How did the COVID-19 pandemic impact your projections for the growth of the industry?
A: The impact of the COVID-19 pandemic has been tremendous. The aviation industry suffered enormously because passengers stopped traveling. This led to a slowdown in aircraft orders that hurt the whole manufacturing chain. However, the sector’s manufacturing projections for 2030 are still the same. The pandemic only slowed down the process. The sector will recover slowly because the supply chain is still needed and SMEs have the capability to change quickly and balance their work.
For Mexican SMEs, the trick will be to have a balanced portfolio and to prepare for the peaks in the aerospace sector. We are discussing with the Ministry of Economy the provision of financial support to train and accelerate SMEs in the incorporation of digital technologies. We are also supporting actions to encourage the relocation of Asian manufacturing companies to Mexico in an effort to add more value to North America’s aerospace sector.
In mid-June 2021, we received support from the US to provide a training program in the Texas region that will address the lack of technical know-how, which has been the main barrier for companies to operate in that country. This program is not limited to the aerospace sector; it incorporates companies in the automotive, military equipment, medical devices and electronics industries and will allow us to identify gaps in supply chains. Finally, we are reactivating and updating the iCluster platform to help companies large and small to grow.
Q: What steps are Mexican suppliers taking alongside FUMEC to become globally competitive?
A: Our program incorporates Mexican companies and SMEs that are scaling up and we accompany them through all processes. We assess the company’s profile and follow up with an aerospace assessment to identify opportunities and competencies. We then incorporate our network partners to help SMEs gain access to all the necessary processes and funds. Clusters are an essential part of this process given the boost they provide to companies. We also give SMEs exposure at forums and events to help them increase their presence in the industry.
Q: What projects is FUMEC leading to link the aerospace industries in Latin America?
A: We have been working with Colombia and Costa Rica to boost the aerospace sector. We analyzed what worked in North America to provide a similar strategy to other countries. We work mainly with clusters and provide them networking aid to help them get to know each other and develop joint projects. We are now planning to present a proposal to an aerospace cluster in El Salvador, which became interested in the sector after the US announced that it would give resources to countries in Central America to strengthen their production lines.
Q: What future opportunities in Mexico’s aerospace industry should be considered to make the sector more competitive?
A: There are numerous opportunities for manufacturing because the needs of the market have not yet been fulfilled. The aerospace sector has constant demand so there will always be a need for production. Mexico’s manufacturing sector must change to meet the projected demand for 2030. It will not be easy because supply chains must be put in place and the talent has to be developed. The sector could continue growing thanks to nearshoring trends and the opportunities laid bare by the USMCA agreement, which capitalize on Mexico’s location. Our goal is to help SMEs be prepared to fill these gaps in the supply chain as fast as possible.
The US-Mexico Foundation for Science (FUMEC) is an NGO created in 1992 that aims to promote science, technology and innovation initiatives.