Tijuana Wakes Up!

Richardglobalheader
Resized_AlarmClock_Mexico_GreenRed_2009_1
In my last posting I wrote about the emergence, at least
according to New York Times writer, Chris Anderson (“Mexico: The New China”),
of a San Diego / Tijuana industrial hub that he believes will rival the Hong
Kong
/ Shenzhen nexus.

What might make San Diego / Tijuana as an alternative for
US manufacturers? 
Anderson sites several
reasons:

  • A shorter supply chain allows for small batch
    production and shorter lead times. 
  • Just in time manufacturing allows for running
    changes rather than having to wait until current inventory has sold through.
  • Reduced risk from a constant on-site presence
    reduces downstream costs.
      If there is
    something wrong in production, the company learns about it as it happens rather
    than waiting to discover it once the order is received.
  • Wages in Mexico, due to Chinese inflation
    over the last decade, are now more in line with China’s pay rates. 

I would add that:

Producing near the US border
can result in one or two additional product turns for companies and retailers.

Company principals can, if
they wish, shuttle to the factory on a daily basis.  This constant presence on the manufacturing floor
can reinforce that company’s business culture.

The ability of Mexican
trucking companies to now cross the border is off to a slow start but, should it develop as
expected, could create even shorter delivery times.

It will be interesting to
see if we see a migration of companies to the San Diego area.  If you are producing in Mexico, planning to or
thinking about it; let us know if you think that the San Diego / Tijuana hub is
something toy and play companies should be considering.

 

2 thoughts

  1. Today, what is seen now and anticipated to grow even more is the “Baja Triangle” of Tijuana, Tecate, and Ensenada. Tijuana has already eclipsed San Diego in size and population, and many fine international corporations have found increased efficiency and lowered costs by moving their plant operations over the border. Cosmopolitan cultural interests have populated these areas, inclusive of arts and restaurants. The tail is now wagging the dog. The triangle is experiencing a robust boom in housing and an expansion of Mexico’s middle class, and the expert working of labor, craftsman and manufacturing are filling the new residences with Mexico’s guarantee of one mortgage per working family. The violence reported in the Texas areas has calmed over the last 4 years due to amnesty and outreach programs; whereas the San Diego California and Baja North border bi-national business zone should be construed as a safety net for dual nation “partnerships” across many industries, other than concerns in the “drugs” or pharma sector.

  2. I live in SoCal and drive into TJ quite often and since the tube television market is gone their are lots of presses sitting idle. Machine rates are dirt cheap and quality is high. My company has seen sales increase double digits year over year for the last 3. From Mecicali to Tj it seems to be getting more and more business. Plus, these border areas are not as violent as some of the other cities bordering Texas and in deeper Mexico.

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