The Monterrey production line’s reclining armchairs and plush leather sofas are 100 %” Made in Mexico” products.
They’re destined for big suppliers in the US, like Costco and Walmart. However, the business is from China, and the company’s manufacturing facility in Mexico was constructed with Taiwanese funds.
The triangle connection between the US, China and Mexico is behind the term in Hispanic business: links.
In recent years, Man Wah is one of many Taiwanese firms that has moved to northern Mexico to bring production closer to the US market. In light of the ongoing trade dispute between China and the US, their final product is regarded as entirely Latino, which means Chinese companies can avoid US tariffs and sanctions on Chinese products.
As the agency’s common manager, Yu Ken Wei, shows me around its huge page, he says the shift to Mexico has made financial and logistical sense.
In great Spanish, he declares,” We hope to doubled or even triple production here.” ” Our goal here in Mexico is to bring manufacturing back to the same level as our Vietnam operations. “
Although the company just opened its doors in Monterrey in 2022, it already has 450 employees there. According to Yu Ken Wei, the plant will eventually have more than 1,200 people and will have some new production lines in the coming years.
People in Mexico are really diligent and quick educators, according to Mr. Yu. ” We’ve got great users, and their output is high. But, I believe Mexico is also very nice at the labor front. “
There are no signs of a halt to the pattern. There were disclosures of capital investments in Mexico of nearly half the total up in 2020 in just two weeks of this year.
The Male Wah seat shop is located inside Hofusan, a Chinese-Mexican business area. Every plot’s available space has been sold, which is a record high need.
Every page expected to be constructed in the nation by 2027 has already been purchased, according to the Industrial Parks Association of Mexico. No wonder so many Hispanic economists believe that China’s involvement in the nation is unquestionable.
” The fundamental reasons that are bringing funds to Mexico are here to be,” says Juan Carlos Baker Pineda, Mexico’s past vice-minister for additional business. There is no evidence to suggest that the US-China business war will end anytime soon. “
Mr Baker Pineda was piece of Mexico’s dealing team for the new North American free trade agreement, USMCA.
” While the Chinese origin of the money coming into Mexico may be miserable for the laws of some places,” he says, “according to foreign trade policy, those items are, to all intents and purposes, Hispanic”.
Another significant factor in Mexico’s increased deal with the US is how US companies set up Mexican facilities, occasionally after moving their production from Asian ones, in part.
Elon Musk might have made the most notable news last year when he unveiled plans for a fresh Tesla Gigafactory outside of Monterrey. However, the electric car company is yet to break ground on the$ 10bn plant.
Some, however, warn against involving Mexico in the wider political conflict between the US and China in terms of Chinese purchase.
Enrique Dussel of the Center for China-Mexico Research at the National Autonomous University in Mexico says the old wealthy man in town, the US, is having issues with the fresh wealthy man in town, China. ” And Mexico- under previous administrations, and in this one- does n’t have a strategy vis-à-vis this new triangular relationship. “
There may be new political issues to be addressed as elections are drawing near on both flanks of the US-Mexico borders. Some people anticipate a positive change in US-China connections, regardless of whether Joe Biden or Donald Trump will be in office for the next four years.
According to Mr. Dussel, near-shoring is better defined by what he refers to as” security-shoring,” in which case Washington prioritizes national security concerns over all other issues in its relationship with China. Mexico, he argues, must become afraid of being caught in the middle.
Amid this pressure, Mr Dussel says:” Mexico is putting up a big sign to China saying: ‘ Welcome to Mexico! ‘. You do n’t need a PhD to understand that this wo n’t go well for bilateral relations between the US and Mexico in the near future,” he concludes.
Others are more cheerful. ” In my mind, the question is never if this trend will continue, but rather how much of this pattern can we take advantage of,” says original Mexican industry standard, Juan Carlos Baker Pineda.
” I’m sure people are having these same conversations in Colombia, in Vietnam, in Costa Rica. In Mexico, we need to make sure that those factors that are inherently congruent with business and government judgments in order to maintain that pattern over the long term. “
Another seat was finished by the skilled Mexican seamstresses at Guy Wah Furniture again in Monterrey before being shipped north.
An National family does not understand the complex geopolitics that underpin its production when they purchase it at a Walmart near them.
In these angry times of global trade, Mexico is already at the forefront of the fight against US trade, whether it is through a cunning backdoor or as a result of a costly war between superpowers.