Entrada Group Podcasts: How The Mexican State of Guanajuato Became a Global Automotive Powerhouse
From modest beginnings in the early 1990s when GM was the first OEM to establish operations in Guanajuato (in Silao), to today, when the auto industry is responsible for roughly half of the state’s industrial output, much has changed in the state of Guanajuato. This explosive growth is discussed in Entrada Group’s latest podcast: “How Guanajuato Became a Global Automotive Powerhouse.”
How did the central Mexican state of Guanajuato, which traditionally had an economy based on agriculture and light industry, grow annual state exports exponentially throughout a 20-year period, with automotive manufacturing leading the way? Today, ten automotive OEMs and hundreds of suppliers are located within a 120-mile radius of the state, according to Manuel Fernandez, the Director of International Promotion for Guanajuato, who was interviewed for the podcast. That presence at least partly explains the jump from $200 million to $20 billion in state exports, and why so many auto producers are looking to the central Mexico state for growth, Fernandez said.
Throughout the past decade alone, Guanajuato has garnered more than $15 billion in investment, mostly within the automotive sector, Fernandez said. Sector growth has led to new opportunities for suppliers in the area, with acute need for producers in a range of areas including forging, mold-making, tool and dye-making, plastic injection and electronic componentry, he added. Suppliers often establish Mexican operations initially in support of a single OEM or large supplier, but down the road most “…do business with a lot of companies, not only in the state but [shipping] to the U.S. and all over the world,” Fernandez said.
In addition to billions of dollars of foreign direct investment, the workforce has become more competitive and capable. The statistics speak volumes: In 2015, the state trained more than 100,000 workers and is graduating more than 5,000 engineers per year from universities and technical institutes. “We have an institution that makes tailor-made training programs,” to help employers ramp up quickly, Fernandez said. “We have sent more than 1,000 people from Guanajuato to be trained overseas: US, EU, Japan.”
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About Entrada Group
For nearly two decades, Entrada Group has been guiding manufacturers in establishing and running their own cost-effective Mexican operations in order to enhance global competitiveness. Within Entrada’s manufacturing campuses, and with the support of its shared services teams, manufacturers are able to meet their Mexican corporate obligations, minimize costs and lessen their exposure to risk. Entrada’s turnkey system provides a fast track to the benefits of Mexico and allows manufacturers to fully focus on growth.