Supply Chain: Mexico

Addy is an AI-driven tool that organizes large amounts of data into easy to understand formats. Allowing us to discover more in-depth insight into the topic at hand. Addy publications is our way of showcasing what the Addy tool can potentially do for you. We created a model on Supply Chain (SC) that resulted in a qualitative analysis of what people on the internet are saying about SC. Addy found that Mexico was mentioned 22 times making it the top location. Addy provided insight into the different contexts that Mexico was being referred to, which are climate change/natural disasters, transportation and delivery, automotive supply hotspots, free trade agreements, and emerging markets.
Climate Change/Natural Disasters
As global climate change continues to spike conversations throughout the world, there are rising concerns about the carbon footprint manufacturers are leaving behind and the impact their operations have on Earths' climate. Supply chain methods should be used to analyze current carbon footprints to discover new methods on how to reduce it. With climate change comes an increase in natural disasters, companies should address the possibility of a natural disaster in creating and deploying their supply chain management platform. For example, a manufacturing company in Mexico must understand and account for a potential earthquake or drought and how these occurrences could damage their supply and production network. It also should have a proper contingency plan for maintaining production levels should these events take place. The ability to accurately plan for and forecast future demand based on past production and supply is perhaps one of the core drivers in avoiding disruption and promoting sustainable manufacturing programs. [1*]
Transportation & Delivery
International deliveries can be a lot more complicated than deliveries within the same country. Mexico is mentioned here as an example of delays associated with international transportation and delivery. A manufacturing company looking to transport parts from a hub in Mexico to a facility in Dallas, Texas must account for additional lead times for the U.S. customs inspections and regulations. Failure to address this additional stage in transportation and delivery could result in orders not being filled as scheduled, additional fuel costs and more port complications. [1*]
Automotive Supply Hotspots
Industry insiders are rapidly realizing that Mexico could be the next hotspot in the automotive supply landscape. At the end of 2015, Mexico was the 8th largest automaker and the 4th largest exporter of parts and components for the global automotive industry. Also at the end of 2015, light vehicle production hit 3.4 million units allowing analysts to forecast that number will increase to roughly 5 million units by 2020. Mexico is looking to keep a stable automotive industry as its infrastructure maintains 117 deep-sea/coastal ports with the capacity to house and transport large containers. Their ability to accommodate that scale of ships and containers is necessary for large scale productions and is key for companies looking to leverage competitive advantages not only in N. America and Canada but also in emerging markets like S. America and Mexico itself. [2*]
Free Trade Agreements
Mexico is a top player in 10 key free trade agreements allowing them access to 45 countries across the world. Mexico has a consumer base totaling over 1.2 billion people. The ease of restrictions, tariffs, and taxes on global trade uniquely positions Mexico as a center of production and supply logistics as companies can freely move products, production, and labor without becoming overwhelmed with the possible complications that come with country-by-country trade laws. Mexico also boasts thousands of miles of railways that could allow for more cost-effective freight options into N. America and other neighboring markets. [2*]
Emerging Markets
The movements toward opening up new and emerging markets, particularly in areas like Mexico and Asia increase the efforts in moving towards more digitalized processes. Companies must incorporate all-digital platforms as they strive to remain competitive in a crowded marketplace. Due to the rise of Big Data, cloud computing, and other data storage and management platforms, digitizing supply chain mean companies will have greater data gathering, reporting, and analytics capabilities. [3*]
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Sources: [1*] https://blog.flexis.com/5-primary-causes-of-supply-chain-disruptions | [2*] https://blog.flexis.com/on-the-move-why-mexico-is-the-hot-spot-in-supply-logistics | [3*] https://blog.flexis.com/the-benefits-of-a-supply-chain-digitization
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