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ARIZONA-MEXICO SUPPLY CHAIN LANDSCAPE ANALYSIS: A
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CONSULTING PROJECT:
A RIZONA -M EXICO S UPPLY C HAIN LANDSCAPE A NALYSIS :
A N EARSHORING S TUDY
C ONSULTANTS :
G ONZALO A RICETA B RETT DAVIS A BHILASH M ISHRA T OMMY O GDEN G REG O SBORNE A S SOCIATE C O N SU LTA NT :
F RANCISCO S ANCHEZ
P ROJECT G OAL : I DENTIFY M EXICAN OWNED COMPANIES IN THE MAG REGION , COMPANIES IN THE MAG REGION ENGAGING IN TRADE WITH M EXICO, COMPANIES IN M EXICO ENGAGING IN TRADE WITH THE MAG REGION , AND THE CURRENT TRADING ( EXPORTS / IMPORTS ) BEING DONE BY THESE INDUSTRIES. I DENTIFY
ECONOMIC DEVELOPMENT OPPORTUNITIES BASED ON THESE
INDUSTRIES AND TRADING TRENDS.
P ROJECT P HASES : • P HASE 1: E ARLY S TAGE – R ESEARCH & A NALYSIS • P HASE 2: M ID S TAGE – I N - DEPTH R ESEARCH , A NALYSIS & P RELIMINARY F INDINGS • P HASE 3: F INAL S TAGE – A NALYSIS R ESULTS, F INAL R ECOMMENDATIONS • F INAL D ELIVERABLE : APRIL 30 TH R EPORT
F INDINGS
FOR
FACILITATING O PPORTUNITY:
• PARTNERSHIPS BETWEEN C ITIES /S TATES • R EINVESTMENT
• I NCENTIVES
IN
B ORDER /P ORTS
TO ATTRACT
BUSINESSES
F INDINGS FOR FACILITATING G ROWTH : • I NTERACTIVE S UPPLIER DATABASE
• C ROSS -B ORDER PARTNERSHIPS • A EROSPACE / AUTOMOTIVE / M ETAL S TAMPING
Baja California (Baja California, Baja California Sur)
Northern Mexico (Chihuahua, Coahuila, Durango, Nuevo León, Sinaloa, Sonora, Tamaulipas)
The Bajio (Aguascalientes, Guanajuato, Zacatecas, San Luis Potosi, Querétaro)
Central Mexico (Hidalgo, Mexico City, Mexico State, Morelos, Puebla, Tlaxcala, Veracruz)
Pacific Coast (Chiapas, Colima, Guerrero, Jalisco, Michoacan, Nayarit, Oaxaca)
Yucatan Peninsula (Campeche, Quintana Roo, Tabasco, Yucatán)
MEXICAN REGIONS
WEST
EAST
• Population: 114.8 Million (UN, 2011 ) • Main Exports: Machinery and transport equipment, mineral •
fuels and lubricants, food and live animals Gross Domestic Product: $1.657 Trillion (2011 est.)
% of Total Exports AZ to by Commodity Type Percentage of MX AZ2010 Exports to MX
2010: By Commodity -
Others 28.21%
Total $5.05 Billion
Electrical Machinery; Equipment & Parts 32.58%
Paper & Paperboard 3.35%
Computer-Related Machinery & Parts 12.85%
Measuring & Testing Instruments 3.45%
Plastics & Articles 9.14%
Mineral Fuels; Oils & Waxes 3.61%
Copper & Articles 4.27%
Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
Percentage of Exports from AZ to MX 2011: By Region - Total $5.05 Billion
.
Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
Percentage of MX Imports to AZ in 2010: By Commodity - Total $5.63 Billion Others 20.42% Optical, Photographic, Cinemagraphic 4.34%
Vehicles Other than Railway and Train 5.71%
Edible Vegetables 27.95%
Electrical Machinery & Equipment 18.21%
Nuclear Reactors, Boilers, Machinery & Mechanisms 12.13%
Edible Fruits & Nuts 11.24%
Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
MEXICO’S IMPORTANCE TO AZ Top Origin Markets for International Travelers to the U.S. (2010 vs. 2009 & 2008)
Mexican visitors spent $2.65 Billion in AZ from July’07 to June’08.
Arizona All Tourism Economic Impact by County
Source: Office of Travel and Tourism Industries – US Department of Commerce
Source: University of Arizona , Mexican Visitors to Arizona: Visitor Characteristics and Economic Impacts, 2007-08
WHY MEXICO IS GROWING
Slide content from www.teamnafta.com
A EROSPACE I NDUSTRY WITHIN THE M EXICAN S TATES / M ETROS
A UTOMOTIVE I NDUSTRY WITHIN THE M EXICAN S TATES / M ETROS
Slide content provided by COPRESON
Slide content provided by COPRESON
AUTOMOTIVE O PPORTUNITIES : Ford Plant – Hermosillo New $1.5 Billion investment Increase capacity to 500,000 vehicles per year
North America, South America, and Middle East Fusion (Summer 2012)
Fusion Hybrid Lincoln MKZ
500,000 cars X $25,000 = $12.5 Billion in Revenue
M ETAL STAMPING O PPORTUNITIES :
HQ in Connecticut
HQ in Minnesota
2006 – Horst Engineering de Mexico (Nogales, Sonora)
2011 – Incertec de Mexico (Empalme, Sonora)
2009 – Horst Medical is formed
Impact: 20% increased business Pursuing Certificates for:
Bombardier Embraer Cessna
A EROSPACE O PPORTUNITIES : Precision Aerospace / Precision Products de Mexico (Phoenix, Arizona )
(Guaymas, Sonora )
R AW M ATERIALS O PPORTUNITIES: C OPPER P ROCUREMENT • Copper is a key material for many companies in the Sonoran region • Procurement Managers import copper pipes from China and Germany • These imports have up to 90 days in lead time
Opportunities For:
SOME INTEGRATION MOVEMENTS
Imports from MX in US$ 2004-2010 100,000,000
Total Imports From MX
80,000,000
Texas
60,000,000
California Arizona
40,000,000
20,000,000
0 2004
2005
Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
2006
2007
2008
2009
2010
COMPARISON WITH OTHER B ORDER S TATES
Source: Team Nafta and US Census
TEXAS CASE • C ENTRALLY LOCATED • 23 T OLLED P ORTS OF E NTRY • P ORTS SUPPORTED BY PRIVATE AND PUBLIC FUNDS
• F UNDS USED TO REINFORCE INFRASTRUCTURE OF BRIDGES AND SURROUNDING PORT AREAS
• PARTNERSHIPS BETWEEN T EXAS AND M EXICO C ITIES Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
CALIFORNIA CASE B AJA C ALIFORNIA — S AN D IEGO • L ARGEST POPULATION OF MAQUILADORAS • BAJA IS SEEKING TO INCREASE ITS COMPETITIVENESS THROUGH S OUTHERN C ALIFORNIA S UPPLIERS • S AN D IEGO B ORDER T RADE O FFICE ASSISTS TO FACILITATE NEW EXPORT RELATIONSHIPS
O TAY M ESA E AST P ORT OF E NTRY • N EW INNOVATIVE TOLLED P ORT OF E NTRY • E STIMATED COMPLETION IN 2015
G ROWTH O PPORTUNITIES : •
R EDUCE B ARRIERS •
•
DURING THE
B ORDER C ROSSING P ROCESSES
R EINVESTMENT IN P ORTS
E MPOWER SME S TO DEVELOP S UPPLY R ELATIONSHIPS WITH S ONORA •
ATMA’ S 77 SME S – ONLY 10% EXPORTS
•
S UPPORT I NDUSTRIAL PARKS TO CULTIVATE T IER 2-3 SUPPLIERS
•
C REATE F ORUM FOR AZ-MEX C OOPERATION AMONG E CONOMIC D EVELOPMENT I NSTITUTIONS
•
PARTNERSHIPS WITH U NIVERSITIES
THANK YOU FOR YOUR TIME
C ONSULTANTS :
G ONZALO A RICETA
Q&A
B RETT DAVIS A BHILASH M ISHRA
T OMMY O GDEN G REG O SBORNE A S SOCIAT E C O N SU LT A NT :
F RANCISCO S ANCHEZ
A RIZONA -M EXICO S UPPLY C HAIN LANDSCAPE A NALYSIS :
A N EARSHORING S TUDY
C ONSULTANTS :
G ONZALO A RICETA B RETT DAVIS A BHILASH M ISHRA T OMMY O GDEN G REG O SBORNE A S SOCIATE C O N SU LTA NT :
F RANCISCO S ANCHEZ
P ROJECT G OAL : I DENTIFY M EXICAN OWNED COMPANIES IN THE MAG REGION , COMPANIES IN THE MAG REGION ENGAGING IN TRADE WITH M EXICO, COMPANIES IN M EXICO ENGAGING IN TRADE WITH THE MAG REGION , AND THE CURRENT TRADING ( EXPORTS / IMPORTS ) BEING DONE BY THESE INDUSTRIES. I DENTIFY
ECONOMIC DEVELOPMENT OPPORTUNITIES BASED ON THESE
INDUSTRIES AND TRADING TRENDS.
P ROJECT P HASES : • P HASE 1: E ARLY S TAGE – R ESEARCH & A NALYSIS • P HASE 2: M ID S TAGE – I N - DEPTH R ESEARCH , A NALYSIS & P RELIMINARY F INDINGS • P HASE 3: F INAL S TAGE – A NALYSIS R ESULTS, F INAL R ECOMMENDATIONS • F INAL D ELIVERABLE : APRIL 30 TH R EPORT
F INDINGS
FOR
FACILITATING O PPORTUNITY:
• PARTNERSHIPS BETWEEN C ITIES /S TATES • R EINVESTMENT
• I NCENTIVES
IN
B ORDER /P ORTS
TO ATTRACT
BUSINESSES
F INDINGS FOR FACILITATING G ROWTH : • I NTERACTIVE S UPPLIER DATABASE
• C ROSS -B ORDER PARTNERSHIPS • A EROSPACE / AUTOMOTIVE / M ETAL S TAMPING
Baja California (Baja California, Baja California Sur)
Northern Mexico (Chihuahua, Coahuila, Durango, Nuevo León, Sinaloa, Sonora, Tamaulipas)
The Bajio (Aguascalientes, Guanajuato, Zacatecas, San Luis Potosi, Querétaro)
Central Mexico (Hidalgo, Mexico City, Mexico State, Morelos, Puebla, Tlaxcala, Veracruz)
Pacific Coast (Chiapas, Colima, Guerrero, Jalisco, Michoacan, Nayarit, Oaxaca)
Yucatan Peninsula (Campeche, Quintana Roo, Tabasco, Yucatán)
MEXICAN REGIONS
WEST
EAST
• Population: 114.8 Million (UN, 2011 ) • Main Exports: Machinery and transport equipment, mineral •
fuels and lubricants, food and live animals Gross Domestic Product: $1.657 Trillion (2011 est.)
% of Total Exports AZ to by Commodity Type Percentage of MX AZ2010 Exports to MX
2010: By Commodity -
Others 28.21%
Total $5.05 Billion
Electrical Machinery; Equipment & Parts 32.58%
Paper & Paperboard 3.35%
Computer-Related Machinery & Parts 12.85%
Measuring & Testing Instruments 3.45%
Plastics & Articles 9.14%
Mineral Fuels; Oils & Waxes 3.61%
Copper & Articles 4.27%
Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
Percentage of Exports from AZ to MX 2011: By Region - Total $5.05 Billion
.
Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
Percentage of MX Imports to AZ in 2010: By Commodity - Total $5.63 Billion Others 20.42% Optical, Photographic, Cinemagraphic 4.34%
Vehicles Other than Railway and Train 5.71%
Edible Vegetables 27.95%
Electrical Machinery & Equipment 18.21%
Nuclear Reactors, Boilers, Machinery & Mechanisms 12.13%
Edible Fruits & Nuts 11.24%
Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
MEXICO’S IMPORTANCE TO AZ Top Origin Markets for International Travelers to the U.S. (2010 vs. 2009 & 2008)
Mexican visitors spent $2.65 Billion in AZ from July’07 to June’08.
Arizona All Tourism Economic Impact by County
Source: Office of Travel and Tourism Industries – US Department of Commerce
Source: University of Arizona , Mexican Visitors to Arizona: Visitor Characteristics and Economic Impacts, 2007-08
WHY MEXICO IS GROWING
Slide content from www.teamnafta.com
A EROSPACE I NDUSTRY WITHIN THE M EXICAN S TATES / M ETROS
A UTOMOTIVE I NDUSTRY WITHIN THE M EXICAN S TATES / M ETROS
Slide content provided by COPRESON
Slide content provided by COPRESON
AUTOMOTIVE O PPORTUNITIES : Ford Plant – Hermosillo New $1.5 Billion investment Increase capacity to 500,000 vehicles per year
North America, South America, and Middle East Fusion (Summer 2012)
Fusion Hybrid Lincoln MKZ
500,000 cars X $25,000 = $12.5 Billion in Revenue
M ETAL STAMPING O PPORTUNITIES :
HQ in Connecticut
HQ in Minnesota
2006 – Horst Engineering de Mexico (Nogales, Sonora)
2011 – Incertec de Mexico (Empalme, Sonora)
2009 – Horst Medical is formed
Impact: 20% increased business Pursuing Certificates for:
Bombardier Embraer Cessna
A EROSPACE O PPORTUNITIES : Precision Aerospace / Precision Products de Mexico (Phoenix, Arizona )
(Guaymas, Sonora )
R AW M ATERIALS O PPORTUNITIES: C OPPER P ROCUREMENT • Copper is a key material for many companies in the Sonoran region • Procurement Managers import copper pipes from China and Germany • These imports have up to 90 days in lead time
Opportunities For:
SOME INTEGRATION MOVEMENTS
Imports from MX in US$ 2004-2010 100,000,000
Total Imports From MX
80,000,000
Texas
60,000,000
California Arizona
40,000,000
20,000,000
0 2004
2005
Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
2006
2007
2008
2009
2010
COMPARISON WITH OTHER B ORDER S TATES
Source: Team Nafta and US Census
TEXAS CASE • C ENTRALLY LOCATED • 23 T OLLED P ORTS OF E NTRY • P ORTS SUPPORTED BY PRIVATE AND PUBLIC FUNDS
• F UNDS USED TO REINFORCE INFRASTRUCTURE OF BRIDGES AND SURROUNDING PORT AREAS
• PARTNERSHIPS BETWEEN T EXAS AND M EXICO C ITIES Source: U.S. Department of Transportation, Bureau of Transportation Statistics, Transborder Surface Freight Data.
CALIFORNIA CASE B AJA C ALIFORNIA — S AN D IEGO • L ARGEST POPULATION OF MAQUILADORAS • BAJA IS SEEKING TO INCREASE ITS COMPETITIVENESS THROUGH S OUTHERN C ALIFORNIA S UPPLIERS • S AN D IEGO B ORDER T RADE O FFICE ASSISTS TO FACILITATE NEW EXPORT RELATIONSHIPS
O TAY M ESA E AST P ORT OF E NTRY • N EW INNOVATIVE TOLLED P ORT OF E NTRY • E STIMATED COMPLETION IN 2015
G ROWTH O PPORTUNITIES : •
R EDUCE B ARRIERS •
•
DURING THE
B ORDER C ROSSING P ROCESSES
R EINVESTMENT IN P ORTS
E MPOWER SME S TO DEVELOP S UPPLY R ELATIONSHIPS WITH S ONORA •
ATMA’ S 77 SME S – ONLY 10% EXPORTS
•
S UPPORT I NDUSTRIAL PARKS TO CULTIVATE T IER 2-3 SUPPLIERS
•
C REATE F ORUM FOR AZ-MEX C OOPERATION AMONG E CONOMIC D EVELOPMENT I NSTITUTIONS
•
PARTNERSHIPS WITH U NIVERSITIES
THANK YOU FOR YOUR TIME
C ONSULTANTS :
G ONZALO A RICETA
Q&A
B RETT DAVIS A BHILASH M ISHRA
T OMMY O GDEN G REG O SBORNE A S SOCIAT E C O N SU LT A NT :
F RANCISCO S ANCHEZ
