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Electronics are an essential part of our every day lives. That’s why it’s important for many companies that sell these products to have a manufacturing operation that’s reliable. Fortunately, Mexico makes for a great location to produce these devices.
Key takeaways:
We’ll explain how electronics manufacturing is done in Mexico and the benefits you’ll be able to enjoy when you move your production below the border.
Table of Contents
Mexico’s electronics manufacturing industry is one of the largest in the world. Around 400,000 of the country’s citizens work in the sector. In 2022, the U.S. imported $449 billion of electronics from the country. As the data I’ve provided shows, Mexico is one of the top five countries that supplied the U.S. with these products.
| Country | Amount Imported |
| China | $139 Billion |
| Mexico | $81.8 Billion |
| Vietnam | $41.9 Billion |
| Chinese Taipei | $24.8 Billion |
| Malaysia | $23.6 Billion |
Provided by OEC World
With so much focus on this one industry, the country is able to manufacture extremely large amounts of electronics. In the following section, I’ll discuss the different types of devices that are made in Mexico.
Mexico is known for manufacturing a variety of electronic devices. You’re bound to find a maquiladora somewhere in the country that can produce the hardware you require. To demonstrate this, I’ve provided data on devices Mexico frequently exports to other countries.
| Product | Value Exported |
| Computers | $39.28 Billion |
| Video Displays | $14.11 Billion |
| Microphones & Headphones | $2.14 Billion |
| Radio Receivers | $1.85 Billion |
| Telephones | $1.3 Billion |
| Video Recording Equipment | $67 Million |
Provided by Statista
Consumer electronics are extremely popular because of their frequent use in everyday life. Due to the high demand, manufacturing for these products has been growing steadily in Mexico over the past few years. I’ve provided some data on the revenue this market has generated between 2019 and 2023.
| Year | Revenue |
| 2019 | $15.77 Billion |
| 2020 | $15.7 Billion |
| 2021 | $16.95 Billion |
| 2022 | $16.57 Billion |
| 2023 | $17.18 Billion |
Provided by Statista
Mexico’s revenue from consumer electronics is expected to grow in the coming years, which suggests manufacturing for these products will increase. This makes Mexico a reliable country to set up your electronics production.
Related: How to Find Manufacturers in Mexico
Cost of Manufacturing Electronics in MexicoIf you’re going to move your electronics production to Mexico, you should be familiar with the country’s regulatory, labor, and utility costs. Understanding these expenses will give you a rough estimate on how much you can expect to spend.
Electronics manufacturers in Mexico will be subject to regulatory costs that come in the form of taxes. Companies operating in the country are typically subject to a 16% value-added tax on materials shipped from Mexico. Fortunately, businesses that register under the IMMEX program and obtain an IVA Certification can circumvent these expenses.
There are other taxes that will need to be paid as well:
Whether you subcontract, become a client of a shelter company, or set up your own foreign subsidiary, you’ll need to account for these costs.
Labor costs in Mexico can vary based on the skill level of the worker. To make electronics, you’ll need access to workers that are semi-skilled and highly-skilled. I’ve provided some data that shows the average hourly costs for each one.
| Type of Worker | Hourly Rate |
| Semi-Skilled | $5.20 |
| Highly-Skilled | $8.16 |
Provided by Tetakawi
The labor costs for workers that make electronics will vary based on where your manufacturing operations are located. If your production is located in a metropolitan area or close to the border, you can expect these expenses to be a bit higher.
Utility costs have to be paid to keep your factory operational. I’ve listed the common utilities you’ll encounter and the cost for each one.
| Utility | Cost |
| Electricity | $0.117kWh |
| Natural Gas | $0.034kWh |
| Water and Sewer | $0.007 per gallon |
| Internet Services | $20 Monthly |
| Telephone | $20 Monthly |
Provided by Tetakawi
These expenses can vary based on your utility provider and where your factory is located. That said, they’re much more affordable compared to the costs you’ll encounter if your electronics manufacturer is in China or the U.S.
Where are Electronics Manufactured in Mexico?While electronics are manufactured throughout Mexico, production is concentrated in certain cities, states, and regions.
Popular locations include:
Baja California is a state located in the northern part of Mexico. It has one of the largest clusters of electronics manufacturers and suppliers in the country, with over 200,000 companies operating in the state.
The city of Guadalajara, located in Jalisco, has been nicknamed the “Mexican Silicon Valley” for its high volume electronics manufacturing. A variety of devices like semiconductors and telecommunications equipment are made here.
Numerous electronics companies have also set up their manufacturing operations in Chihuahua. Most of the production takes place in the city of Ciudad Juárez. Many American companies set up their operations here because of how close it is to the U.S./Mexico border.
Guanajuato is a state that primarily focuses on producing automotive electronics. Much of the production takes place in the city of Silao. Numerous automotive companies have set up their operations here.
Related: Mexico To U.S. Trucking Companies
The Distribution Of Electronics Manufacturing In MexicoAfter electronics have been made, they’ll need to be shipped to the United States. There’s an assortment of transportation options that can be used.
Truck transport is by far the most popular way of moving freight from Mexico into the United States. In 2022, nearly 71% of all freight coming from Mexico used this method.
Truck transport is convenient since many of the cities in Mexico that manufacture electronics are close to the border. This means cargo only needs to travel a short distance before reaching a major land port for customs clearance, then transfer to a U.S. driver as needed.
That said, rail might be a more viable option if your electronics are traveling from the south of Mexico. For example, Jalisco is further away from the U.S./Mexico border compared to Baja California. Rail transport would be the better option when importing electronics from this state due to the distance you’ll have to cover.
Air is a good option if you need to get your devices into the U.S. quickly and to a location further from the border. However, it’s extremely expensive, and you won’t be able to move large quantities of cargo.
Related:Mexico To U.S. Trucking Companies
Working with an electronics manufacturer in Mexico is easier than many people imagine. The country has taken significant strides in recent years to make its domestic environment friendlier to international business. Other factors also make it very appealing to U.S. businesses.
This includes:
Mexico’s government has taken numerous initiatives to make electronics manufacturing easier. For one, it offers tax incentives that make these operations cheaper to conduct. The government has also established special economic zones (SEZ) and industrial parks that are designed for electronics production.
The Mexican government has made numerous investments in their infrastructure, especially for the electronics manufacturing sector. Thanks to their efforts, producing hardware and devices has become exceptionally easier.
Types of infrastructure the government has helped build include:
Mexico also has numerous IP protections in place. The protections are enforced by various laws and federal agencies. The USMCA free trade agreement (FTA) also keeps IPs safe by enforcing civil and criminal trade secret provisions. As a result, you can trust your IP to be carefully protected while in Mexico.
USMCA eliminates duties on most goods imported from Mexico, including electronics. This reduces trade barriers that you would encounter if you were to import these products from another country like China. It also makes importing these products cheaper.
Related: A Guide On Shipping Freight To Mexico
If your business manufactures electronics in Mexico, transporting your goods to the U.S. is essential. We specialize in cross-border logistics and have over 30 years of experience that will make moving your cargo more efficient. There are numerous features you’ll be able to enjoy when you ship Mexico Cross Border Freight.
This includes:
Start shipping with Mexico Cross Border Freight by filling out your quote. You can also contact our team at (866) 335-0495 if you have any questions or concerns.
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