The Kia automotive plant in Nuevo León. The Kia automotive plant in Nuevo León.

Nuevo León displaces México state to become No. 1 state in manufacturing

Production of transportation equipment, metals and food made the biggest contributions to manufacturing GDP

Nuevo León has displaced México state to become the largest manufacturing state in the country, statistics show.

Manufacturing in the northern border state was worth just over 850.6 billion pesos (US $44.9 billion) in the first 10 months of the year, according to data from the national statistics agency Inegi.

Production of transportation equipment (including vehicles and auto parts), metals and food made the biggest contributions to manufacturing GDP in Nuevo León, providing 52.9% of the total.

Transportation equipment manufacturing has grown on average by 14.1% annually during the last six years. Almost one-third of all manufacturing revenue in Nuevo León between January and October this year was generated by the sub-sector.

Among the other manufacturing sub-sectors that have experienced strong growth are leather production, beverages and tobacco, printing, plastic and rubber, and paper.

Economy Secretariat data shows that two-thirds of total foreign direct investment in Nuevo León between 2014 and 2019 – more than US $11.8 billion – went to manufacturing, especially the auto parts and automotive sub-sectors.

Kia, Daimler, Navistar, Caterpillar and John Deere are among the foreign companies that have a presence in the state.

The second largest manufacturing state in the first 10 months was Coahuila, where products worth 813.39 billion pesos were made.

Rounding out the top five manufacturing states between January and October were México state, Guanajuato and Jalisco, where production was worth 809.68 billion pesos, 640.66 billion pesos and 438 billion pesos respectively.

México state lost its decades-long stranglehold on the title of Mexico’s top manufacturer due to a decline in production in a range of sub-sectors including transportation equipment, food, chemicals and beverages, and tobacco.

During the last six years, Inegi data shows that Aguascalientes has experienced the strongest manufacturing growth, at 10.1% annually, followed by San Luis Potosí and Baja California, where production increased on average by 9.2% and 9.1% respectively during each year of the period.

Héctor Magaña Rodríguez, head of the Economic and Business Research Center at Tec. de Monterrey, said that manufacturing in Aguascalientes and San Luis Potosí has increased due to strong foreign investment in the automotive sector.

The biggest average annual declines between 2014 and 2019 were in Oaxaca and Tamaulipas, where production fell 9.8 and 5% respectively.

Manufacturing has gone backwards in Tamaulipas mainly due to high levels of violence while in Oaxaca “the lack of strategy to industrialize the state” has resulted in the majority of public resources going to social programs, Magaña said.

Source: El Economista (sp) 

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