The outlook for aeronautical clusters in Mexico, especially in Chihuahua and Querétaro, is positive, with significant growth expected in the short and medium term. Nearshoring will likely boost these clusters by attracting more foreign companies looking to relocate closer to the US due to lower production costs and strategic location. This trend will enhance local capabilities, increase employment opportunities and drive technological advancements, solidifying Mexico’s position in the global aerospace market. 

Investments are flowing into these clusters in an orderly fashion, with hundreds of companies like Safran opting for expansions. Active government participation in specialised fairs, such as the recent one in Farnborough for Querétaro, “is exceeding investment expectations to reach around 3 billion pesos,” stated an aerospace engineer. “This has allowed the aerospace cluster to become one of the state’s growth engines.” 

The engineer also highlighted that promotion by industry leaders, such as astronaut Katya Echazarreta, has also been instrumental in attracting investments, particularly in the space sector. The engineer continued, “Mexico’s comparative advantages are no secret: we are close to the United States, which favours technological exchange, but thanks to the country’s competitiveness, it is also highly attractive for developing nearshoring businesses.”  

“Mexico’s comparative advantages are no secret: we are close to the United States, which favours technological exchange, but thanks to the country’s competitiveness, it is also highly attractive for developing nearshoring businesses.”  

Aerospace Engineer, Mexico

Investment in Mexico’s aerospace industry is expected to rise significantly, driven by competitive production costs, skilled labour and proximity to the US. Due to these advantages, Mexico competes well with other clusters globally. To increase foreign direct investment (“FDI”), the government and regional authorities could offer more incentives, streamline regulations and invest in infrastructure and education.  

Regional governments promote this sector through targeted initiatives, collaborations with educational institutions and the showcase of success stories to attract global investors. The Chihuahua secretary of economic development highlighted, “There is still much to explore, taking into account how Mexico had once managed to make great contributions to the world, including satellite technology, but then we lost that momentum.” 

The Chihuahua secretariat of economic development explained that Chihuahua, Jalisco, Baja California and Querétaro have been “taking advantage of the country’s multiple assets in professional space and skilled labour, as well as economic advantages.” Chihuahua, for instance, “raised USD 40 million by the end of last year, thanks to the strength of its aerospace corridor and the offer to more companies to set up operations in the state,” explained the secretariat. 

However, there is a need for continued investment in talent and technology. Local universities have integrated specialised study programmes, including an aeronautical university, though this remains insufficient to cover industry needs. “The challenges are not minor; it is a very changing industry. Technology evolves very quickly and the demands change very quickly, and that forces us to have the capacity to adapt quickly to respond to this change and remain competitive,” the secretariat elaborated. This gap is mitigated by the ease of importing talent from the US, thanks to geographical proximity. 

“The challenges are not minor; it is a very changing industry.”

Secretariat of economic development, Chihuahua

The pandemic underscored the need for resilience, as evidenced by the industry’s ability to weather the storm better than expected. “As far as possible, we have to shield the production chains because we are talking about an industry where precision and zero margin of error require the entire chain to be oiled,” the secretariat highlighted. 

While Mexico has made strides in establishing the Mexican Space Agency, sufficient funding and clear public policies are essential to convey the country’s commitment to the aerospace sector. Another attraction for Mexico is the tacit agreement between industry, local governments, research centres and other relevant actors to attract investment and create jobs. “This agreement may be vulnerable to political changes, but so far, there is a willingness on the part of both PAN and Morenista governments to continue to support it,” confided the aerospace engineer. “The biggest challenge is ensuring this unrestricted support continues because suddenly there are mixed signals, and nearshoring represents an opportunity for the industry.”   

The outlook for Mexico’s aerospace sector is promising, with ongoing investments and strong government support. However, challenges such as market adaptability, security concerns and the need for advanced legislative frameworks remain critical to sustaining and accelerating the industry’s growth up, up and away.