Growing appeal of Mexico for European aerospace manufacturers

Les Echos investigates the growing appeal of Mexico particularly for European aerospace manufacturers and their suppliers, which see in this dollar-based country a solution to the threat of the weak US currency over their competitiveness. The state of Queretaro, 200km north of Mexico City, has become the new global aeronautics ‘El Dorado’. Following the steps of Bombardier and Embraer, who has just invested $ 85M in a new site in Queretaro, an increasing number of suppliers are shifting production to Mexico: Goodrich has moved to Mexicali to produce systems for the Boeing 787; Safran has become the country’s largest employer with more than 3,500 workers across two sites; General Electric plans to hire 600 additional workers at its design centre in Queretaro; and Honeywell inaugurated a new $ 40M test centre in 2006. Even US suppliers need to relocate part of their production as Boeing and Airbus step up pressure on price. Les Echos adds that the two plane makers have actually inspired this relocation wave. Nearly 80% of the 787 Dreamliner work is outsourced to suppliers worldwide, and Airbus is expected to follow Boeing’s model with its future A350 XWB. In this light, other countries could benefit from the situation: Morocco, the Czech Republic, China, India or Brazil are all vying to welcome European and US players. Les Echos