Factors that Influence the Development of Local Suppliers of the Automotive Sector in Aguascalientes

Abstract

Currently, benefits from the export of vehicles produced in Mexico surpass the joint income generated by other “traditional” budget-forming activities like oil export, tourism, agricultural exports and remittances. Therefore, it is not surprising that the Mexican government’s expectations of economic growth are tightly connected with the maintenance and development of the country’s automotive industry. For this, the main strategy chosen by the Mexican Government has been the attraction of foreign direct investment to the sector where large transnational carmakers are invited to settle their production lines in Mexico. Nevertheless, while such strategy offers undisputable advantages, successfully harnessing all its benefits represents a real challenge for Mexican local firms and for the Mexican economy. Hitherto, a number of programs and strategies have been designed and implemented, aimed to a better integration of Mexican micro, small and medium enterprises (MSMES) in the production chains of the transnational companies, with different degrees of success achieved. Nevertheless, the integration of the Mexican MSMES into the production chains of the Japanese carmakers is still very limited. In the present work, using as a study case the presence of Nissan in the state of Aguascalientes, we make an overview of the factors that influence this process of incorporation, identified through interviews with representatives of Mexican and foreign Nissan’s suppliers, of the Government and education institutions, as also from the analysis of official sources and local news. One of the identified key factors hindering the insertion of local MSMES into the automotive production chains is the absence of a vision of what is expected in the future for the Mexican automotive industry, as well as a lack of continuity in the efforts that have already been made to develop local suppliers.