Automotive Supply Chain Trade Mission
to Central Mexico
September 21 - 24, 2003

Mission Description:

The International Trade Administration of the U. S. Department of Commerce, Commercial Service in Mexico is organizing an automotive supply chain trade mission, which will visit the states of Aguascalientes and Silao, September 21-24, 2003. Participating U.S. companies will benefit from briefings by local experts on the Mexican market and pre-scheduled, pre-screened one-on-one meetings with Mexican companies.

Commercial Setting:

Mexico is considered one of the most important manufacturing platforms for the automotive industry in the Western Hemisphere. With an impressive two digit annual growth rate in total units manufactured of automobiles, trucks and buses, Mexico is becoming a target export market for automotive related industries, including parts, sub-assemblies, consumables and services for the industry.

The Mexican automotive industry contributes 2.9% of GDP and represents 13.5% of the manufacturing sector. Automotive production increased from 457,000 units in 1985 to over 1,933,000 units in 2000. The number of automobile brands sold in Mexico increased from nine to 17 from 1985 to 1999. The Mexican Association of the Automotive Industry (AMIA) estimates that production will reach a total of over 1,800,000 vehicles by end of 2002. Over 1,335,000 of these are expected to be for export, while 465,000 units will be sold in the local market.

A number of auto firms have set up their manufacturing plants in small and medium-sized cities in Mexico to serve the export and local markets. Nissan - recently merged with Renault - established its main manufacturing facility in Aguascalientes, investing more than $1 billion USD. General Motors established a large award winning operation of light trucks and SUVs in Guanajuato and has plans for a 11% production increase in the next year. The other companies such as Cooper Standard, Donaldson, American Axle,
SMC and U.S. Manufacturing also have their operation in the region.

The specific commercial situation in the states included in the mission are as follows:

AGUASCALIENTES

A small state with less than a million inhabitants, the GDP of Aguascalientes has been growing by 10% almost every year since the early 90's. With an established ten year record, the Aguascalientes automotive cluster represents one of the major industrial markets in Mexico. Automotive-related industry, services, and trade contribute to 85% of the state's gross domestic product. Most industry is located in the Aguascalientes-Rincon de Romos corridor, in two industrial parks in the capital and two parks outside of it. More than 30 companies make up this important cluster. Opportunities in this sector can be found for U.S. suppliers of precision metalworking, plastics, electronic components, tool and die, molds, specialized packaging, automation and sensors, and laboratory equipment for quality assurance.

SILAO

Guanajuato has made great strides in the automotive and automotive parts industry with the installation of important plants such as the light truck assembly plant of General Motors, situated in the outskirts of Silao, a small city located one and a half hours south of Aguascalientes. The state government is interested in promoting the development of an automotive parts supply cluster in the area. In this sector, opportunities can be found for manufacturers of leather seats, electric and electronic components, air conditioners, oil and fuel filters, suspensions, paints, tires, batteries, wheels and rims, springs, shock absorbers, engine parts, gears, alternators, starters, brake systems, etc. 85% of Mexico's automotive plants are within a 400-mile radius of Guanajuato, thereby offering a strategic position for the development of OEM suppliers.

Mission Goal:

The mission goal is to increase the mission members' exports of products and services to the automotive industry clusters in Aguascalientes and Silao by providing market information and key contacts in this rapidly growing sector.

Mission Scenario:

Mission members will meet with potential buyers in both cities at local manufacturing facilities. Additionally they will meet with manufacturers associations and government officials to learn about the local market and selling opportunities. The precise schedule will be structured based on specific goals of the mission participants and availability of local government officials.

Timetable
Day #1 Sunday
Arrive Aguascalientes airport (Nissan/Renault cluster). Hotel check-in.

Day#2 Monday
a) Commercial Briefing with US Commercial Consul, industry association, and local industry specialists.
b) 4-5 Gold Key meetings with potential customers. (Translators provided as part of Gold Key.)
c) No-host dinner with Governor of Aguascalientes (to be confirmed).

Day #3 Tuesday
a) Hotel check-out. Transportation via executive bus to Silao, Guanajuato (GM cluster). Travel time is approximately 1.5 hours. Hotel check-in Silao.
b) Business briefing with local industry representatives and government officials.
c) 4-5 Gold Key meetings with potential customers. (Translators provided as part of Gold Key.)
d) Dinner (no host) in Guanajuato, the historic colonial capital. Travel time is approximately 15 minutes one way.

Day #4 Wednesday
Return to United States from Leon Airport. (15 minutes from Silao)

The precise schedule will depend on the availability of local government officials, industry specialists and specific goals of the mission participants.

The deadline for receiving completed applications is August 8, 2003. Applications received after the application deadline will be considered only if space and scheduling constraints permit.

Recruitment and Criteria for Participation:

a) Relevance of a company's product line to automotive industry base of suppliers.
b) Potential for business in the NAFTA market.
c) Provision of adequate information on company's primary market objectives in order to facilitate appropriate matching with potential business partners.
d) Maximum of 15 and a minimum of 7 participating companies.
e) A timely receipt of trade mission application, company's signed participation agreement, including a participation fee of $1,995 USD.

Event participants will be recruited by the U.S. Commercial Service in accordance with the objectives of the mission statement. Any company that is interested in participating and that meets the U.S. Department of Commerce (USDOC) participation guidelines is eligible to participate, subject to CS Mexico's determination that there is a market for their product or service in Mexico.

As per USDOC participation guidelines, U.S. companies wishing to participate in the event must certify that their goods and services are either manufactured or produced in the United States, or if manufactured or produced outside of the U.S., they must certify that the goods and services are marketed under the name of a U.S. firm and that the final product has at least 51 percent U.S. content.

Recruitment of U.S. firms will be conducted in an open and public manner, including promotion through the U.S. Commercial Service network and direct contact with trade associations throughout the United States. This event will be listed in the Federal Register and on International Trade Administration's home page: www.ita.doc.gov/doctm/tmcal.html

Any partisan political activities (including political contributions) of a U.S. firm are entirely irrelevant to the event selection process.

Contact:

Isabella Cascarano
U.S. Department of Commerce
Commercial Service
Guadalajara, Mexico
Ph. +52 (33) 3615-0980 ext. 110
Fax. +52 (33) 3615-7665
Email: isabella.cascarano@mail.doc.gov

Eric Nielsen
U.S. Department of Commerce
Tucson USEAC
Tucson, Arizona
Ph. (520) 670-5540
Fax (520) 791-5413
Email: enielsen@mail.doc.gov