Mexico’s economic moment
By David Agren - Monday, March 18, 2013 - 0 Comments
That boom coming from North America’s southernmost state isn’t just gunfire
Mario Armas/AP
A new truck rolls off the assembly line every minute at the GM factory in the conservative Catholic heartland of Mexico’s Guanajuato state. The factory in Silao, set in the shadow of a giant Christ statue considered the geographic centre of the country, produces so many trucks that GM has expanded its workforce by more than 60 per cent since 2008 and has plans to hire even more. The nearby Volkswagen plant just opened a $550-million engine plant and Toyota has announced plans for a facility down the road.
Manufacturing activity is mushrooming across Mexico, mirroring an upswing in the overall economy. The country produced more than 2.8 million cars last year, while factories in border towns like Tijuana and Ciudad Juárez churn out everything from plastic toys to plasma TVs. Manufacturing is now moving back from China—almost as fast as it fled Mexico a dozen years ago—as Asian salaries and shipping costs continue to rise. “This has nothing to do with Mexico,” Ed Juline, head of Guadalajara-based Mexico Representation, a business consultancy, says of the trend. “It has everything to do with China.”
Ten years ago, wages in Mexico were six times higher than those paid in China, but the gap had narrowed to 40 per cent by 2011, according to an International Monetary Fund report. Geography also works in the country’s favour, as companies take advantage of its easy access to U.S. and Latin American markets, where economies are expanding, demanding Mexico’s autos, appliances and advanced electronics.
-
Monster Beverage Corp. has a headache, while Chevy Volt gets a boost
By Tamsin McMahon - Thursday, November 8, 2012 at 8:10 AM - 0 Comments
A business recap of energy drinks, electric cars, and Mexican labour
Jan-Philipp Strobel/Keystone Press
Energy drinks have courted controversy with a business model many see as based on pumping teenagers full of caffeine. But investors have largely tuned out those complaints. Monster Beverage Corp. has been the greatest beneficiary of the stock market’s love for energy drinks. Company shares more than doubled last year, topping $78 in June, as its oversized cans and provocative slogan—“unleash the beast”—made it the largest U.S. energy drink producer by volume.
That was until last week, when its shares plunged nearly 30 per cent on news the Food and Drug Administration is investigating reports five people have died since 2009 after consuming Monster drinks. The FDA said it has not yet linked Monster to any of the deaths, but the bad publicity sparked whispers that Coca-Cola is backing away from plans to buy the company. The stock market, it seems, is finally coming down off its buzz around energy drinks.
Bright Idea: Lube, oil and software fix
Last week, General Motors Co. announced a software update for its Chevrolet Volt, contacting about 4,000 owners of the plug-in hybrid over a glitch that could cause the electric motor to suddenly shut down, even while the car was moving. They were asked to bring their vehicles to a dealer for a fix, but in the future, more software updates might happen automatically and over the air—just like an iPhone. Continue…
