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Business Opportunites in Mexico - Aguascalientes
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 Aguascalientes is a second tier manufacturing market in Mexico. Its location off of the NAFTA Highway makes transportation somewhat difficult both for northbound products and those heading into central Mexico. However, there are some major operations located in the city and the skilled labor force and lower production costs will continue to attract new companies. Nissan is the biggest story in town and has recently attracted some new mid-sized suppliers to the area. We expect this city to grow, but not at a pace comparable to the El Bajio region or cities with better transportation access.
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ADVANTAGES
An abundant and educated labor force.
Low production costs.
No payroll taxes and a state government very supportive of industry and investment.
Aguascalientes has the lowest incidence of union unrest: no strikes were reported in the state in the last 30 years.
DISADVANTAGES
Distance from the U.S. border and its location off of the NAFTA Highway increases freight management and logistics costs.
Relatively limited support services infrastructure.
Underdeveloped industrial real estate market.
POPULATION
Aguascalientes, the capital of the State with the same name, has an estimated population of 643,419 people according to the 2000 census, though 2002 estimates set the number at 688,458 people. This population is growing at an average annual rate of 2.4%, faster than the 1.8% national rate, with over 13,000 people joining the workforce annually. It is should be noted that the city’s population represents 68% of the state’s population of 1,012,893 inhabitants. (Source: INEGI)
LOCATION
The city of Aguascalientes is located in the south central region of the state with the same name, which is located in the geographical center of Mexico. The city is located 508 miles south of the U.S. border and 313 miles north of Mexico City at an elevation of 6,181 ft. The state of Aguascalientes is surrounded by the state of Zacatecas to the north and the state of Jalisco to the south. Annual average precipitation is 18-20 inches and the rainy season runs from June to August.
The weather is generally mild and pleasant with the following average temperatures.
INDUSTRY SNAPSHOT
Aguascalientes has traditionally been an agricultural center that is now emerging as an industrial location in central Mexico. Industry development started at the beginning of the 1980’s with the establishment of the automotive and electronic industries. Today 68% of total foreign direct investment (FDI) comes from Japan, and 29% from the U.S. Nabco, Nicometal, Sanoh, A.T.C., and Kappler are among the main Japanese companies that operate in the city.
FDI in Aguascalientes concentrates mainly in the manufacturing sector, particularly in the automotive and auto parts industry that represents 72% of the total FDI (USD $3,100 Million), followed by the electronics industry with 19% of FDI (USD $806 million) while the textile and apparel industry reached USD $102 million. (SOURCE: Statistics Department. Secretariat of Economic Development).
SKILL LEVEL
Maquiladoras with operations in Aguascalientes use world class technology for their operations and perform high value added activities. 72% of the maquiladora activity in the city is related to the auto and auto parts industry and 19% to the electronics industry. The quality and productivity of the workforce has been recognized internationally and companies in the city have modern technological and organizational operating and training systems.
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EDUCATION and TRAINING PROGRAMS
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The State government has invested heavily on education, which reflects on both an educational level that surpasses the national level and a literacy rate of 95.8%. This is higher than the 90.5% national rate. Aguascalientes has an elementary school completion rate of 84%; one of the highest in the country. The technical education system Aguascalientes consists of 14 schools and 4 institutions that offer several job training programs, including automotive technician, automotive mechanic and automotive electronics among others. University enrollment rose to 20,583 students in last year. Over 85 majors are offered, among which engineering degrees have the highest demand.
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TRAINING PROGRAMS
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The government of Aguascalientes has implemented a plan to tailor school programs towards the export manufacturing sector. Additionally, the State Government offers 883 courses and 9,300 training scholarships. About 20,000 unemployed workers are trained on a yearly basis. School-Company ties are necessary in order to orient careers offered by the educational system towards the industrial sector. One of the most important projects is the “School of Technological Education of Aguascalientes" (CETMEJA), which prepares technicians for the automotive and auto parts industries.
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WAGE RATES
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Wages are the key driver of Mexico’s manufacturing industry. It is, therefore, one of the first and most important topics any company expanding in Mexico will consider. TeamNAFTA touches on the overall wage issues in our Info Center, but we have also provided some sample wages for Aguascalientes below. While we have access to more detailed wage information, we typically present that information in a tailored report addressing a company’s specific labor needs. Average hourly wages paid in Aguascalientes: 2003 – 2004 U.S. dollars/hr. includes all mandatory and average optional benefits for this market.
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INDUSTRIAL PARKS
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A 25.4 miles long industrial corridor holds eight industrial parks and one Service Park with 764 hectares for industrial use and 27 hectares for electric power and telecommunications services as well as direct access to railroad tracks. The State government developed its Industrial Park program in 1975 and is currently expanding the industrial infrastructure with three new parks for a total of 11 Industrial Parks:
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Industrial City – Ciudad Industrial
San Franciso
Del Valle de Aguascalientes
El Vergel
Siglo XXI
Altec
Tecnopolo Pocitos
Chichmeco
Calvillo
El Llano
Paseos de Aguascalientes
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