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The Industria Manufacturera, Maquiladora y de Servicios de Exportacion (IMMEX) program, formerly referred to as the Maquiladora Program, has been a major part of manufacturing operations in Mexico since 1965. The advantageous geographic locations of these manufacturers along with other key benefits create lucrative opportunities for businesses based in the U.S.
Key Takeaways
In this article, we’ll take a close look at each of the benefits that maquiladoras have to offer U.S. manufacturers.
Table of Contents
Some of the most significant benefits of maquiladoras are a result of the USMCA, which replaced NAFTA in July 2020. This trade agreement did away with most tariffs on imports and exports between the U.S., Canada, and Mexico. With these fees removed, more businesses are able to profitably manufacture and transport merchandise.
To qualify for duty-free import and export, shipments must be accompanied by a USMCA Certificate of Origin. This document confirms the goods are sourced from one of the three countries participating in the agreement.
Since 2009, China’s labor costs have steadily risen above those of Mexico.
For the purposes of determining minimum wage, Mexico is divided into a general area and the Northern Border Free Zone. In the table below, I’ve laid out these wages in MX$ and USD.
Daily Mexican Labor Rates in 2024
Region | Daily Wage Average in MX$ | USD Equivalent per Day |
Northern Border Free Zone | $375 | $19.49 |
General | $249 | $12.94 |
The result is that Mexico’s labor rate is now competitive with the Asian manufacturing powerhouse. Combine that with the ongoing trade war between the U.S. and China, and Mexican manufacturing becomes a go-to option for businesses looking for inexpensive labor.
The proximity of many maquiladoras to the U.S. means shipping times are far lower than they would be coming from an overseas manufacturer.
Maquiladoras located close to the U.S. border can often deliver their finished goods to the border states of California, Arizona, New Mexico, and Texas in just a few hours.
Another benefit of the close geographical distance between the U.S. and maquiladoras in is reduced shipping costs. With a shorter distance to travel, less fuel and labor is needed to deliver products.
Cargo and freight insurance costs will also be lower than comparable rates on ocean-going shipments due to shorter transit times and fewer opportunities for accidents to occur.
In addition to benefits associated with reduced duties and tariffs, here are several more conventional tax benefits for stateside companies who decide to shift manufacturing duties to a maquiladora.
Lastly, businesses can get a tax deduction of 47-53% on employee benefits such as pensions and other bonuses.
Related: Shelter Companies in Mexico: A Complete Guide
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