What Can Global Manufacturers Learn From the Crisis Caused by the Japan Quake?

Written by Collectron Tuesday, 22 March 2011 14:51

The current crisis in Japan brings up many important questions for manufacturers world-wide. One of those questions is: do you have a plan in place if an unavoidable disaster, such as a natural disaster, causes long-term disruption to your plant operations?

In Japan’s case, could outsourcing part of a manufacturing plant’s production line to Mexico provide a feasible and cost-effective solution to plant shutdowns, rolling blackouts and potential long-term disruptions caused by the recent earthquakes and tsunamis? According to recent reports, Fernando Sierra Ortiz, president of Mexico’s National Chamber of Electronics Industry, seems to think this is a not only a viable option for high-tech manufacturers, it’s a current reality. He is reported as saying that a number of damaged Japanese electronics companies plan to move a portion of their production processes to Mexico in the near future.

With the advantages of proximity to the US – especially in light of rising fuel costs – plus preferential duty treatments that can lower manufacturing costs, trade agreements with 43 different countries, a skilled workforce and intellectual property protection, Mexico could prove to offer enough benefits to attract struggling Japanese manufacturers. These same advantages have already proved beneficial to hundreds of international companies that have established maquiladoras in Mexico thanks to shelter plan programs.

Only time will tell how the global manufacturing landscape will be altered by the natural disasters in Japan, but we can hope that out of the tragedy will come new solutions and opportunities to work together to mutually benefit each country. This is what Collectron President Maria Elena Rigoli would call the power of her motto, “Together, we will.”