The northwest Mexico states of Baja California and Sonora represent a powerful industrial force.

      Sonora has important electronics and automotive clusters. Baja California’s strengths include electronics, automotive, IT and biosciences. Tijuana has grown into an important manufacturing center and has become the television manufacturing capital of the world as well as an important electronic cluster.

      Neighboring San Diego has experienced economic development in the defense industry, as well as the biotechnology, aerospace, electronics and computer industries. Both communities have enjoyed positive growth in recent years. In Tijuana, foreign manufacturing has steadily generated jobs. Manufacturing in Tijuana represents 45 percent of the permanent jobs in the private sector.

      Tijuana is an industrial community with more than 40 years of experience in international production sharing activities. With nearly 600 maquiladoras, and about 200,000 workers, Tijuana has more manufacturing facilities than any other city in Mexico.

      The electronics sector represents approximately 30 percent of the manufacturing industry in Tijuana. Companies with maquiladoras plants in Tijuana are mainly U.S. corporations, but also include firms from Southeast Asia and Europe. Among them are Sony, Samsung, Sanyo, Hitachi, Mattel, Sharp, Phillips, and others.

      Tijuana provides a favorable environment to manufacturing operations. Labor and a readily available and mature workforce, including technical personnel, competitive labor cost and easy access to the United States together with the services and facilities available in San Diego make it an ideal manufacturing location.

      Tijuana has more than 2 million people and one of Mexico’s highest annual population growth rates at more than 4 percent. It is home to almost 70 percent of all Asian investment in Mexico and an estimated 13 million television sets are manufactured here every year.

      The dynamic manufacturing industry in the city creates areas of opportunity in other sectors and following is a short list of infrastructure/development projects taking place in the region:

      •An aqueduct to bring water from the Colorado River to Tijuana.

      •Three water treatment plants.

      •A natural gas pipeline to supply the industrial sector of the state.

      •Significant development of low-medium housing projects. This industry has grown more than 300 percent in the last 10 years.

      •An inter-modal transportation terminal.

      Governments in San Diego and Tijuana are exploring the possibility of a cross-border air terminal that would allow passengers to access Tijuana’s airport directly from the United States.

      “We are extremely happy that Mexico and the United States are collaborating and setting a historical precedent regarding air transportation in a cross border environment,” said Jim Janney, president of the South County Economic Development Council (SCEDC) board of directors.

      In February, the San Diego Regional Airport Authority agreed to spend a maximum $385,000 on a market demand study for a terminal that would allow San Diego passengers to access flights out of Tijuana Rodríguez International Airport without having to drive across the border. Previous SCEDC studies have found that a cross-border terminal could reduce traffic congestion at both the San Ysidro and Otay Mesa border crossings.

      The market demand study will look at four different schematics for terminal operations. Among the options to be studied:

      •A parking structure in California linked to the Tijuana airport terminal by a secure walkway.

      •A full-service terminal in California, where travelers check in, linked to the Tijuana airport by a secure walkway.

      •A full-service terminal in California, where travelers check-in, linked to a new U.S. concourse at the Tijuana airport by a walkway. 

      •A terminal, concourse and gates in California with a taxiway across the border to the Tijuana airport.

Ensenada

      Considered the city with more scientists per capita in Mexico, the private sector here has created the Bio Business Council, dedicated to convert this potential in an opportunity. All activities are supported on the following facts:

      •The cost of drug development has soared in the last 10 years.

      •To lower costs, U.S. biotech and pharmaceutical companies are moving operations to countries such as Canada, India, China, Singapore and Russia.

      •Ensenada sits in close proximity to the Western United States, and shares the same time zone, which gives it a strategic advantage over other competing geographical locations, such as China and India.

      •The proximity to San Diego California (70 miles), which has the 3rd largest biotech cluster in the United States, provides ready access to a large population of skilled scientists, venture capitalists, and strategic partners looking to reduce drug discovery costs.

      •Operating costs are lower. (More favorable tax treatment, lower rents for industrial space, slightly lower pay scale relative to the United States.)

      •Mexico enjoys NAFTA membership which provides significant advantages with respect to the import and export of products into and out of the United States.

      •The existence of large bilingual populations in both San Diego and Ensenada, investors would be able to tap into a pool of educated Mexican scientists for employment opportunities.

      •The ability of U.S. customers to readily and quickly come out and inspect the plant and manufacturing facilities.

      IT companies have also found a successful business environment to birth and grow in Ensenada. Consider:

      •67 percent of the people have at least a bachelor degree.

      •Area universities and R&D centers are focused on IT, physics, photonics, biotechnology, advanced materials, among others.

      •Baja California leads IT and communication services in Mexico. There are big companies established such as Telnor/Telmex, Telcel (wireless telecommunication services), and Telvista (call centers).

      •Around 80 percent of the total number of companies in Baja California, offer customer service support.

      •Growing foreign investment in IT.

      •Growth of exports to the United States, mainly to California and Arizona

Tecate

      Tecate is called the industrial paradise of the Baja California, since high-level worldwide industries are concentrated here.

      Industrial activity is complemented with 135 assembly plants (maquila), mainly of the electronic area, wood furniture and plastic ware.     

      The city of Tecate offers all that is necessary to establish an assembly plant. Some of the best known here are:

      •Schlage de México, SA

      •Rockwell Automation

      •Formula Plastics

      •Quixote Corporation

      •Hudson

      •Taylor Guitars

      •Prositec, SA

      •Best RV

      •Innovative Industries

Mexicali

      By the mid 1960s, cotton was no longer the engine that drove Mexicali’s economy. Today vegetable crops are at the top of the list of agricultural products for export.

      Thanks to its geographical location, the decree of this border region as a tax free zone for imports, and the North American Free Trade Agreement, Mexicali has seen a boom in the assembly plant industry. Mexicali is recognized around the world in the field of electronics and state-of-the-art technology. In addition to assembly plants, Mexicali also excels in manufacturing activities.

      Mexico’s most important truck and tractor-trailer manufacturing plant (Kenworth) is located here. The retail industry is a dynamic and important part of the economy. Modern shopping centers have sprung up all over the city, offering visitors a great variety of quality services and products.

      PACCAR has invested $74 million in the construction of a new Kenworth manufacturing facility in Mexicali. “This investment increases production capacity in Mexico by 50 percent,” noted Sam Means, KenMex president. “Significant advances in IT and an expanding global manufacturing platform have resulted in PACCAR more than doubling its sales of commercial vehicles in Mexico and export markets compared to 10 years ago, while simultaneously improving product quality and employee productivity.”

San Diego

      The San Diego regional economy continues to undergo a dynamic transformation from one based on military and defense spending to an economy that is propelled by high-technology companies competing in the international marketplace. These mostly small and mid-size high-tech firms produce the products and services most in demand in the new global economy. Since a recession of the early 1990s, San Diego has seen dramatic increases in its gross regional product, exports, per capita income, and employment.

      Independent studies indicate San   Diego is one of the top 10 cities in the country for job growth through 2025, and many of the high-tech jobs are being created by emerging high-tech companies in the region.

      The top four industries in San Diego are manufacturing, defense, tourism, and agriculture. In addition, the city of San Diego focuses on six main industry clusters:

      •Biotechnology/Biosciences

      •Defense and space manufacturing

      •Electronics manufacturing

      •Financial and business services

      •Software

      •Telecommunications

      Other industries showing significant growth include environmental, transportation, recreational goods, and international trade. San Diego is home to one-third of the country’s top 20 environmental design firms, has more than 1,000 companies concentrating on transportation technologies and services, and has more than 600 companies in the region with bi-national operations.

Sonora

      Sonora’s state government has been investing in programs that improve existing infrastructure, production equipment, urban equipping and worker training. Sonora has strong clusters in automotive, electronics, medical, aerospace, metal-mechanic and agricultural.

      A significant percentage of the aerospace operations in Mexico are located in Sonora. World leaders in the aerospace field have made Sonora their home. Main products manufactured here include turbine components, engine parts, faucets, welders, harnesses and components for the aerospace and military industry, airplane fuel meters, brake system components, hydraulic system valves, airplanes harnesses, security system, and plastics for molding.

      The metal-mechanic sector has recently grown from small generic machining shops to more complex operations. These include local companies manufacturing trailers, platforms and furniture to international names like Master Lock, Acco, Weiser Lock, Moen, Otis Elevator, Alfa Laval and others, manufacturing high quality metal products like locks, office equipment, faucets, elevator parts, and stainless steel pipes.

      The automobile and auto parts industry in Sonora employs more than 15,000 people, contributing nearly 10 percent of the state GDP. The future of the automotive industry in Sonora looks bright, with Ford investing $1.6 billion to expand its assembly operations in Hermosillo. The main products manufactured in this industry include automobiles, connectors, cables, auto parts, car assembly, dashboards, seat covers, stamps, pistons, cylinders, flexible circuits and light-striped cable for the electronic industry, plastics for molding, suspension system, chassis frontal part, alarm systems and remote controls.

      The electronic industry is another sector that has had a permanent presence in the state. From the manufacture of PC boards and SMT assemblies, to the assembly of computers, monitors and power supplies, the electronic sector has steadily diversified and grown in Sonora. Main products include computers, electronic connectors, wire-harnesses, PCBs, consumer electronics ERPs, specialized software development, cables for the automotive industry, radio frequency coils for radios, television sets and computers and instruments to measure pressure.

      The medical industry has also recently come to Sonora with companies here manufacturing surgical needles and staples, catheter equipment, medical attire, transfers pipettes, and glass equipment, recyclable products, dental parts, porcelain and removable metal crowns.

      Sonora has 19 universities and 12 technical institutes. Many of the universities have modern laboratories where the students make their practices. This ensures the skills of the new graduate in its job.

      Sonora’s advantages include the following:

      •Qualified and profitable labor pool, mainly for the maquiladora industry.

      •The state of Sonora has the highest national literacy average (most Sonorans complete 9th grade, while the rest of the nation averages a 6th grade education).

      •Low crime rate.

      •Agricultural, food and fishing products with the highest quality standards.

      •Wide availability of natural resources (minerals, fertile soil, natural fishing estuaries, sea and tourist attractions).

      •10 percent of the total population is enrolled, at any given time, in a higher education program (undergraduate, post-graduate or professional).

      •Large availability of industrial parks (43 distributed all throughout the state).

      •World-class sporting, leisure and tourism infrastructure.

      •Privileged geographic location —370 miles of border with the United States —750 miles of coastline (Sea of Cortez).

      •Strong entrepreneurial culture.

      •World-class industrial research capabilities.

Main infrastructure

      •Five international airports: Hermosillo, Guaymas, Ciudad Obregón, Puerto Peñasco (Rocky Point), Nogales.

      •One deep sea port, Guaymas, and two other important fishing ports, Yavaros and Puerto Peñasco (Rocky Point).

      •American consulates in Hermosillo and Nogales.

      •Fastest border crossing gates.

Important cities

      Nogales is the state’s main port of entry to Mexico. The city owes its development and current growth to international circumstances.

      Nogales is named after a ranch that achieved world-wide fame during the colonial period and was located southeast of the current city of Nogales, Son. The city of Nogales arose spontaneously near the point at which the American transcontinental railroad connected the railroad of Sonora, a project completed in 1882.

      From the beginning this town was defined by international trade such as farming products and minerals.

      In the 1970’s the national Border Program changed the exporting dynamics of the products in Nogales. The services that the city provides run the gamut: hotels, restaurants, hospitals and schools of all levels

      Nogales is one of the most important border zones, characterized by great economic activity and shopping centers where visitors will find a wide range of domestic and imported products.

      The most important port in Sonora is found only 135 kilometers from the state capital of Hermosillo. The city and port of Guaymas are one of the main national and foreign tourist destinations in the state.

      The tourist beach zone, known as San Carlos, is located to the northwest of the port. Bacochibampo and Miramar Bays are also well-visited attractions.

      For an entire century the port was developed as a strategic point for mission settlement, military invasions and pirate attacks. Its commercial activities were promoted by maritime traffic, converting this city into a major port. Today focusing on a tourism mission, Guaymas possesses 24 places with accommodations, between hotels, motels and guest houses. However, an important industrial park is also located in neighboring Empalme.

      San Luis Río Colorado is an important port of entry for the country and Sonora, but in the 15th and 16th centuries it was just a crossroads for the first Spanish settlers. The city lies at the geographic convergence of four states, two in Mexico and two in the United States.

      Given this peculiarity, San Luis Río Colorado benefits from strong commercial and service sectors. U.S. citizens also take advantage of these niches, finding quality service and inexpensive prices for medical and dental services.

      With the growth in population, housing and real estate developments have increased and created a new community image. Modern and functional housing complexes are transforming the valley of San Luis Río Colorado into a modern and prosperous port of entry.

            Hermosillo is the capital of Sonora and home to a Ford Motor Company automotive assembly plant. Located just 250 kilometers from the border with Arizona, it is an excellent place to do business.