News Article

What is Next for the Aerospace Sector in Mexico?

By Alessa Flores | Wed, 11/27/2019 - 18:12

It’s time for Mexico to take the next step on the world’s aerospace stage, which means bolstering its capacities, said Jorge Gutiérrez, Dean of UNAQ, during the Mexico Aerospace Forum 2019 at the Marquis Hotel in Mexico City on Wednesday. “More than 90 percent of the country's industrial capacity comes from foreign countries. Mexico's next step will be to improve its local capacity to emerge as a world leader in the field.” 

Gutiérrez moderated the event’s final discussion and sought each panelist’s view regarding what comes next in their respective areas and how their organizations aim to participate in this future scenario. Daniel Parfait, President of Safran México, stressed the seeds for the future of the aerospace sector have already been sewn. “We hope to continue to grow with the same energy and, in return, to see greater investment from both the private and public sectors to improve Mexico's capabilities globally,” he said. "A clear example that Mexico is growing is that when Safran started operating in the region, it had only five clients. Today, it has 40 companies." 

In general, the industry needs more growth, but at the local level, companies are looking for ways to help SMEs transition into the sector’s value chain. Alberto Robles, LATAM Strategic Supply Chain Leader at General Electric Infrastructure Querétaro (GEIQ), believes “the industry is growing at an accelerated pace and perceiving a growing demand from the Asian continent. The industry needs to strengthen the participation of local providers, especially tiers 2,3 and 4, if it wants to solidify this transformation.” 

The main obstacle for including SMEs into the value chain is their lack of a cooperative culture. “There is a resistance from small and medium-sized companies to comply with the industry’s certifications and norms. Although many SMEs have joined this initiative, there is still room for improvement,” said Juan Alberto Porras, Director General of CONCAMIN.

Gutiérrez asked the representatives of the Confederation of Industrial Chambers (CONCAMIN) and the Ministry of Economy, as key players in Mexico’s economy, how they support the development of local investment and development of local providers. CONCAMIN represents around 54 percent of Mexico’s GDP and its member companies employ the majority of workers in the country. “CONCAMIN has been an important actor in developing public policies that support the growth of the different economic sectors of the country and to guide the government to pay more attention to talent and SME development,” said Porras. 

Sergio Silva, Head of the Economic Intelligence Unit at the Ministry of Economy, said the aerospace sector will continue to grow in the coming years. “Andrés Manuel López Obrador’s administration is aware of the importance of the sector and it is sure it will continue to grow in the coming 15 years to become a leader in the global market.” 

Nevertheless, to consolidate this growth, there must be changes to how economic development is approached. "As far as industrial policy is concerned, we are seeking a stabilizing element that must be adapted to the new reality of the economy. Not to protect ourselves from external competition, but to integrate our economy into the global value chain," said Silva. 

Alessa Flores Alessa Flores Senior Journalist and Industry Analyst