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Why are US companies manufacturing in Mexico?

by GM
manufacturing in Mexico

Many US companies are manufacturing in Mexico and they are very successful there. There are several reasons for this. The Mexican government introduces different policies from time to time as per the requirements of the companies which ensure the ease of doing business. It builds an environment in which things are done professionally and that the cost becomes less than the other parts of the world. The Mexican government introduces different programs from time to time and they are quite helpful for the companies working there and in return, this increases the trade rate of Mexico. There are plenty of companies succeeding in Mexico. You can get a better insight into this from Tacna. A lot of reasons involved in the selection of Mexico for the manufacturing.

Free Trade:

The Mexican government supports free trade which helps the companies working there. Many issues get resolves due to this and the companies find it easy to work in Mexico. This is one of the primary reasons that companies are succeeding in Mexico at a higher rate and the manufacturing industry is flourishing there day by day. Many top-notch US companies are working in Mexico and their maximum production happens there.

IMMEX Program:

Immex program is another major reason for companies succeeding in Mexico at a fast pace. The Immex program excludes the duty fee and the taxes from the import of the raw material due to which the cost is decreased. When the cost is decreased, and investors are facilitated they feel pleasure and comfort in working in Mexico rather than other states where they are supposed to pay higher taxes along with the duty fee.

Transparency:

The transparency of the whole procedure also holds an important place and is appreciated. There are proper check and balance on the imports and exports of the country. The repute of the manufacturing industry of Mexico is quite good which attracts investors, and the companies eventually succeed in Mexico.

Ease of transportation:

Easy transportation is also provided to the companies and they are helped with it too. There is a proper mechanism established for the whole procedure as well. Due to which the companies like to work in Mexico and their success rate in Mexico is also higher.

Educated workforce:

It is easy to get an educated and skilled workforce in Mexico and the companies do not have to go through the ambiguities and perplexing procedures too. The workforce understands the work well and they are easy to work with. When the workforce is cooperative the success rate automatically increases.

Cheap workforce:

The workforce in Mexico is cheaper than in the other major countries. Whenever a company or an investor works their major concern is the profit that they will get in the end. And if the workforce is expensive, they can end up losing the major chunk of their profit but in Mexico the workforce is cheap and hence this is not an issue.

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