News Article

Chihuahua's Automotive Success Story

Mon, 09/01/2014 - 11:52

Over the last decade, Chihuahua has received more automotive investment than any other Mexican state. According to the Secretariat of Economy, Chihuahua has received 25% of the US$18 billion invested in Mexico over that period. In fact, Chihuahua’s automotive exports surpassed US$9 billion in 2013, even without an OEM assembly plant located in the state. This success did not happen overnight. Several initiatives were launched over 40 years ago with the support and coordinated efforts of local businesses, government, and educational institutions. At the time, the term cluster had not even been coined for such communal efforts.

Chihuahua’s proximity to the US was an advantage, but this alone was not enough. Projects were launched to bolster the availability of skilled people, such as the opening of ITESM’s Chihuahua Campus, regarded as one of the best technical universities in the country. Today, the state of Chihuahua has the largest percentage of manufacturing jobs in Mexico. It is also home to a bilingual, bicultural, and highly skilled population, with over 3,000 engineers graduating every year from colleges located in the state and investment in education and technology continues to be a priority. Chihuahua is also home to five engineering and design centers, with Delphi’s Technical Center being the largest in Mexico. Located in Ciudad Juarez, it employs over 2,000 engineers who collectively generate the largest number of patents in the Mexican private sector each year.

Automotive companies that consider establishing an operation in Mexico will benefit from what Chihuahua has to offer. The existing supplier base already manufactures millions of auto parts every year and some estimates calculate that about 60% of the components needed to assemble a car are already produced in the state. The shared need for local suppliers for metal stampings, machined parts, forgings, and castings has further propelled ongoing efforts to develop new suppliers, technologies, training programs, and the expansion of infrastructure.

The growth of the Bajio region during the last few years is a reality that threatens Chihuahua’s leadership with regards to foreign investment. Just a few years ago, automotive companies only considered Mexico’s northern states for their location, but with the flood of new investment to central Mexico, projects are now spreading to wider and more diverse areas. The competition among states is continuing to intensify, and this has led Chihuahua to think seriously about the future. New strategies are being developed by the same three sectors that worked together 40 years ago to establish the Chihuahua Automotive Cluster.