Automakers Spur $3 Billion Boom for Made-in-Mexico Steel

Mexico is on the verge of moving onto a much better economy, and the automakers are a huge factor in that shift. Now, the steel producers in Mexico are able to benefit from increased activity in the production of cars, and they are currently working to improve their factories so that the expected increase in demand can be met.

Mexico is in prime position to take over a very large portion of the market for cars due to its geographical location. Also, wages are fairly steady, measured at about 20 percent f the U.S.’s and Canada’s wages, and Mexico is working to provide a better environmental for businesses. In fact, Mazda plans to open a $800 million factory, expected to open in 2014.

The main issue now is that the Mexico’s steel industry is very far behind in comparison to the strength of Mexico’s automobile industry, meaning that steel producers have to quickly ensure that their steel is up to the standards and quantity demands. If they can manage that, there is no reason for automakers to import given the potential logistics and costs associated with importing.

Source:

http://www.bloomberg.com/news/2013-04-17/automakers-spur-3-billion-boom-for-made-in-mexico-steel.html

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: