With lower shipping costs and increasingly competitive wages, Mexico is enjoying a manufacturing boom, attracting billions of dollars in foreign investment from firms that are building factories to supply the North American market — a concept known as nearshoring.
Most recently, automakers Nissan, Audi, Honda and Mazda have all announced plans to open plants in Mexico over the next few years.
Italian tire maker Pirelli & C. said earlier this year it would invest $300 million in new factories in Mexico by 2015, and Swedish appliance maker Electrolux moved a plant last year from Webster City, Iowa to Juarez, Mexico.
Blue-chip aluminum producer Alcoa also expanded its facility in Acuna, Mexico, joining U.S. companies already producing there, such as General Electric, Honeywell, and Hawker Beechcraft.
The influx shows no signs of abating.
Foreign direct investment, or FDI, in Mexico reached $19.4 billion in 2011 — with nearly half of that total destined for the manufacturing sector, according to the Mexican Ministry of the Economy.
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