Yes, It Is Safe to Manufacture in Mexico

May 13, 2020

Manufacturing companies looking for cost savings and unrivaled trade access to the United States and the rest of the world, can all agree that there are clear advantages to doing business in Mexico. However, there’s one major question that many company executives ask before committing to a Mexico-based operation: is it safe to manufacture in Mexico? 

Certainly, Mexico — home to more than 126 million people — has its share of grim headlines. With a recent report from the Citizen Council for Public Security and Criminal Justice proclaiming Mexican cities to be among the world’s most violent, it’s understandable why manufacturers might pause. But looking at one dataset provides a skewed picture. 

After all, you wouldn’t weigh a decision to move manufacturing based solely on low upfront costs. More likely, you’d look at the total cost picture, including initial relocation costs and long-term operational costs. The same is true when assessing the region’s safety. By examining all the available information, you can make an educated decision — and ensure your staff’s safety in the workplace. 

Must Read: Everything you need to know about manufacturing in Mexico

The problem 

As research has pointed out, violence in Mexico has climbed in recent years. A closer look into this problem indicates that much of the violence is the result of low-level gang fighting over drug markets. While this doesn’t diminish the fact that violence is a problem in some parts of Mexico, it does identify the primary concern. Homicides are not arbitrary, but largely the result of drug violence targeted at drug dealers and users. 

As Sofia Huett, head of Guanajuato’s security commission has commented, “Sometimes people confuse the violence with a lack of public safety in Guanajuato, and in fact they are two different things.” 

Perhaps this is why places like Guanajuato make the list for increased crime and as one of the safest places to travel in Mexico. Incidents of violence typically won’t affect professionals not involved in criminal activities. 

Crime is typical in any large metropolitan area around the world. Still, the levels of violence against citizens not involved in the drug trade are comparatively low, according to Mexico’s police officials. Still, those officials are actively working on policies to lower the total number of criminal acts.

Your solution

Acts of violence against large manufacturing operations or their employees are very unlikely to occur in Mexico. Even cargo theft — an issue for any manufacturing facility around the world — is relatively low. To prevent this type of theft, many companies opt to locate within a Manufacturing Community that comes loaded with security features. 

For example, Tetakawi’s Manufacturing Communities operate safety and security measures in compliance with OEA certification, which certifies that private companies meet globally recognized safety standards. These industrial parks have controlled access with 24/7 guard details and surveillance equipment throughout the park. Security personnel receive extensive training regularly to keep your goods and workforce safe. 

What’s perhaps more important to consider is that most of Mexico is virtually unaffected by the violence. Areas like Queretaro, which is known to be one of the safest cities in Mexico, provide both an excellent quality of life and a robust manufacturing environment. The city of more than 12 million people is home to both automotive and aerospace industrial clusters. Working with a third-party consultant to identify the best location for your manufacturing location is the best way to address safety concerns. 

How to Manufacture in Mexico: Legal Structures and Staying Compliant

The big picture 

Crime is a problem in any country. Through awareness, manufacturers can safely operate almost anywhere in Mexico. What’s important to keep in mind is the big picture around health and safety. 

First, there are many safety and anti-corruption initiatives taking place at the federal and state levels, as well as programs led by private organizations. Organizations like the Center for Citizen Involvement (Centro de Integracion Ciudadana) in Monterrey benefit from support from Mexican corporations and government authorities. This group gathers and reports information on criminal activity and serves as a liaison for crime victims who may be reluctant to work with government officials. 

Second, there is a lot a manufacturing company can do to ensure management and worker safety. Common sense and awareness play a big role here. By performing your due diligence before selecting a site, manufacturers can gain confidence in their wellbeing now and into the future. Hundreds of manufacturers have done this, as is evidenced in the steady foreign direct investment in Mexico.

If you’re ready to begin this site selection discussion, reach out to Tetakawi today.

 

 

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