{"id":1902,"date":"2022-11-22T11:01:53","date_gmt":"2022-11-22T17:01:53","guid":{"rendered":"https:\/\/advance-realestate.com\/adblog\/?p=1902"},"modified":"2025-05-20T13:15:14","modified_gmt":"2025-05-20T19:15:14","slug":"nearshoring-how-can-it-drive-the-automotive-industry","status":"publish","type":"post","link":"https:\/\/advance-realestate.com\/adblog\/en\/nearshoring-how-can-it-drive-the-automotive-industry\/","title":{"rendered":"Nearshoring: how can it drive the automotive industry?"},"content":{"rendered":"
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\n \t<\/i> Read Time:<\/span>3 Minute <\/div>\n\n <\/div>\n

Several companies in the automotive sector are adopting the practice of nearshoring to boost the industry.  Primarily, they aim to promote the interconnection between markets at a global scale while keeping local infrastructure at the forefront.<\/p>\n\n\n\n

Overview of the automotive industry in Mexico<\/strong><\/h2>\n\n\n\n

The automotive sector has positively impacted the domestic economy. The Mexican Automotive Industry Association (AMIA)1<\/sup> stated that in 2022 the automotive industry will account for 3.6% of the national GDP and 18% of the manufacturing GDP.<\/p>\n\n\n\n

Nevertheless, this important market area has faced many challenges in the last few years: the pandemic supply chain disruption, a halting production operation caused by mobility restrictions imposed during the pandemic, and a continuous rise in prices2<\/sup> to name a few.However, to keep making progress, companies in the automotive field are looking for new strategies to enhance their growth, and the most remarkable one is nearshoring<\/em>.<\/p>\n\n\n\n

What is nearshoring?<\/strong><\/h2>\n\n\n\n

It\u2019s a practice that focuses on outsourcing services to countries close to the company\u2019s headquarters. This simplifies operations and cuts costs. It focuses on proximity to suppliers and optimizing the logistics chain.<\/p>\n\n\n\n

Manufacturing companies employ a similar idea; they are located in an industrial park close to the <\/a>main regions where they export their products<\/mark><\/strong><\/a>. It\u2019s worth noting that this practice is gaining ground globally with Canada, Mexico, Brazil, and the United States already implementing this practice.<\/p>\n\n\n\n

Now the automotive sector is going through the same process, specifically in the Mexican cities that border the United States, including those located in the automotive corridor of El Bajio, such as Queretaro<\/strong><\/a> or Guanajuato<\/mark><\/strong><\/a>.<\/p>\n\n\n\n

How is nearshoring boosting the Mexican automotive industry?<\/strong><\/h2>\n\n\n\n

The nearshore strategy leads to new opportunities for companies in the automotive sector through actions like:<\/p>\n\n\n\n

1. Promoting foreign investment<\/strong><\/h3>\n\n\n\n

It\u2019s fundamental to establish operational centers in strategic cities. This way, automotive companies can strengthen their operations and enter new markets. To achieve this, it is essential to choose nearshoring and a growing industrial park.<\/p>\n\n\n\n

Following the above, and based on the report Automotive Investment during 1Q 20223<\/sup>, foreign investment has propelled the industry through this year\u2019s first quarter, resulting in:<\/p>\n\n\n\n