Company Breaks Ground For New Complex
Aerospace companies, especially
large ones, are not typically known for building production
complexes in developing nations as they are for the industrialized
Not so for Bombardier Aerospace, which broke ground this month
for a mammoth complex to build wiring harnesses, fuselages and
flight controls in the central Mexican city of Querétaro,
reports the Los Angeles Times.
Not a stranger to production in Mexico, Bombardier started
production in temporary quarters in May 2006; its Mexican employees
have moved at full speed in the production of sub-assemblies such
as tail rudders and stabilizers -- two years before the company had
Best known for its Learjets and other executive jets, Bombardier
already employs 450 at its temporary quarters; the company plans to
have 1,200 employees in Querétaro by the end of 2008.
Mexican officials project the company will start assembling
complete planes in the country within five years. Company officials
aren't making any promises, but it's clearly on their radar
"There is no doubt in my mind that if we stay focused the way we
are now ... that (Mexico) can do the same as we do in Canada or
Europe or the United States," said Real Gervais, director general
of Bombardier's Mexican operations.
However, industry experts are what you would call dubious, with
some calling Bombardier's talk of building aircraft in Mexico a
ploy to keep Canadian unions in line.
But if it all comes to fruition, Mexico would be one of the few
developing nations doing final assembly of sophisticated
"This is the great objective that we all have, not only
Querétaro, but the nation," said Renato Lopez Otamendi,
secretary of sustainable development for the State of
Mexico's aerospace industry includes about 125 companies and
16,500 workers. From once being known as little more than a
low-cost job shop for US aerospace suppliers, the country's workers
are conducting increasingly sophisticated tasks.
US imports of Mexican aerospace products totaled nearly $178
million last year, up 60 percent from 2000. Total aerospace exports
topped $500 million in 2006, according to Mexico's Economy
Government officials want to keep
Mexico moving up the supply chain. While the country has no
ambition to launch its own national program like China, it is
looking towards more high-value tasks from large companies,
including structure and design work and final assembly.
"The big challenge for our country is to move toward a
technology economy, toward a knowledge-based economy," said Eduardo
Solis, head of investment promotion for Mexico's Economy
Because Mexico is fast losing basic industries such as textiles
to nations with cheaper labor, the country is looking to take
advantage of its success at building products such as
Aerospace's special niche is a huge draw for other industries
such as electronics and metallurgy.
"It's a big deal," said consultant John Walsh of Maryland-based
Walsh Aviation. "But there are a lot of hurdles to getting into the
Developing countries produced less than 10 percent of the
aerospace parts imported by the US last year, according to US
The industry is capital-intensive and highly regulated, noted
Richard Aboulafia, aerospace analyst at Virginia-based Teal
He said the world's plane builders produced fewer than 3,600
turbine-powered aircraft last year -- little incentive for new
businesses to enter the market. And existing companies don't
require cheap labor; what they require are highly-skilled factory
hands, because quality demands are relentless.
"This industry doesn't favor mass production with lots of
workers," Aboulafia said. "Productivity is the name of the
The Bombardier- Mexico connection began with former Mexican
President Vicente Fox, who persuaded company officials to consider
including Mexico in its global manufacturing network.
After a lengthy search in late 2005, Bombardier chose
Querétaro, an industrial center of 1.6 million people, 140
miles northwest of Mexico City, and home to a number of research
centers and multinational companies attracted by the city's solid
universities and educated work force.
Its international airport, which opened in 2004, was a
particular attraction for Bombardier; that is where Bombardier is
building its new complex, part of the company's plans to invest
$200 million in Mexico by 2016.
Meanwhile its temporary plant, running at full capacity, has
workers producing wiring harnesses for CRJ 700 and CRJ 900 regional
jets, and for Challenger 300 and Global Express executive jets.
Plans are for Mexico to become the main producer of electrical
components for all Bombardier planes.
And although it's not unusual for labor-intensive work to be
outsourced to lower-cost countries, Bombardier's Mexican employees
have proven capable of more complex jobs. Workers build the center
fuselages for Challenger 850 executive jets and flight controls for
the Q400 turboprop regional aircraft. They'll be assembling aft
fuselages for Global Express business jets when the new facilities
Plant manager Gervais said that although managing those high
expectations are a challenge, the company has attracted many
qualified workers, some of whom left better paying jobs for
Gervais did note that although their enthusiasm is first-rate,
their productivity and leadership abilities aren't - at least not
With the steep learning curve to build planes, Gervais said it
will take years for his team to acquire the needed experience.
Mexico still must guarantee a safety agreement with the US so
that Mexican-made aircraft made would be approved by American
aviation authorities. And suppliers would have to commit to join
Bombardier in Querétaro; the company currently imports most
of the components it needs -- a time-consuming endeavor.
"We need to build the base of the aerospace industry (in Mexico)
before we start designing planes and manufacturing complete
planes," Gervais said.
Querétaro officials are on board to make that happen.
A local university created a technician program within weeks of
Bombardier's commitment to Querétaro and the State is
building a $50 million aeronautic training center, which recently
hosted 20 potential suppliers in a pro-active effort to convince
them to establish shop there.
Consultant Walsh is skeptical about Mexico's chances, however,
saying Bombardier has a history of shifting work around as a
bargaining tool in labor talks.
Workers such as Maribel Rojas Morales hope he's wrong.
"We're improving every day," said the 24-year-old wire harness
worker. "We can do it."