The Dissonant Threat

Just like a tennis player waiting for a powerful serve from the back of the court, the national industry is making small strides on tiptoes, sharpening its focus, and waiting to respond in some way to what is coming.

The fact that the country's industry is under a clear threat from the United States government is no small matter. Even for veterans like myself, this is an unprecedented circumstance. We have always viewed our northern neighbor as an ally for investment and industrialization, and historically, they have been. But now we face a strange situation where the government of the country of stars and stripes, elected by a clear majority of the American population, wants to reset the conditions and treatment with those it considered partners and allies until very recently. All this is happening in the midst of a commercial and technological war with China.

They do it because they have the power to do so, because they can increase their commercial advantages, but perhaps the most painful part is seeing that they do it because these actions are popular. The reasons why this is dissonant are very evident: a large part of the national manufacturing infrastructure not only produces goods for the United States, it belongs to the United States! Thus, the damage to the national industry has shades of self-inflicted harm.

What will be the level of influence of the same American industrialists to avoid this harm to their interests? How viable is the expectation of relocating entire sectors of the industry and their facilities to the United States? How many of these actions will end up stimulating the problems they theoretically are also fighting, such as migration and inflation in their country? Is this a trend that will only last four years? Will pragmatism prevail over political demagoguery?

As mere spectators of a game where the stakes are the future of a significant part of the country's job and wealth generation, there is not much we can do, except try to make our work as valuable as possible, and hope that it is the Americans and their interests who determine the balance. At the same time, extraordinary efforts must be made to stimulate alternative industries (especially the service sector) to help mitigate the problem that an excessive decision could have on Mexico.

We must be as tactical as possible in this new scenario. As a client told me today: "Toño, this is not the time to sell shoes, it's time to sell soles and half soles." What tactical services can generate value amid the uncertainty where nothing or everything can change any day of the week, month, or year?

Ideally, at this moment, we would be able to sell crystal balls or tarot readings, but for those of us who do not have those skills, we will strive to sell caution, foresight, and security. Our bet at Radwell will be on repair, not replacement. We will sell items discontinued by manufacturers and open a market for remanufactured products with extended warranties that allow the customer to save and continue operating while the scenario changes, and we have a better vision of what seems to be a new global commercial order.

It is sad to think that this is how the golden opportunity of nearshoring will end, another opportunity passing by our country in the midst of the perfect storm: legal uncertainty, energy underdevelopment with a statist drive, insecurity in a large part of the territory, abandonment of education, and the view from our northern neighbors that we are the enemy to beat.

The outlook for what lies ahead is truly difficult to foresee, ranging from ending with a mere scare and discrediting the American president, to one of the worst economic crises our country has ever seen, and even a reordering of the global economy, which indeed seems to be approaching.

Once again, our geographical position places us in a circumstance that could be our greatest fortune or our biggest problem.

Perhaps the only certainty we have left is that we will overcome this problem as we have historically done, thanks to Mexico's main asset: Mexicans.