Many times, after deciding to establish a manufacturing site in a competitive cost country, the next choice to make is “Mexico or China?” China has been an attractive option for many companies, but more and more are choosing to manufacture in Mexico instead. Here’s why.
Location & Logistics
Especially for U.S. companies, Mexico’s location offers huge advantages. It’s easy for managers at U.S. companies to visit facilities in Mexico on a regular basis—you could even get there and back in a day, unlike spending at least half a day just to get to China. Travel to Mexico doesn’t require as much advance planning.
Your Mexican facility will likely be in your time zone, or no more than three hours ahead or behind, so communication will be simpler as well.
Shipping from China takes longer and is more expensive. According to Investing Daily, it would cost about $7,000 to ship a 40-foot container from China, but just $2,800 from Mexico. If your facilities are in one of the border cities, it can take just 24-48 hours to get your finished goods from the plant to their destination in the U.S. Those same goods could take up to three weeks to arrive from China.
Overhead & Transportation Costs