Chihuahua City is big dog in Mexico aerospace

CHIHUAHUA CITY, Mexico — When a jumbo jetliner touches down almost anywhere in the world, the last thing on the pilot’s mind is that the plane’s brakes likely were made in the capital of one of the most crime-riddled states in Mexico.

Behind the headlines of warring drug gangs and a soaring murder rate in Mexico, a fast-growing high-tech economy centered on the aerospace industry has sprung up in recent years.

In Chihuahua City alone, 36 aerospace plants have opened since 2007 as a growing number of international parts makers use the city as a base for tapping a massive airplane-production market in the United States.

“Our first objective was to get into the U.S. market and get a deal with U.S. customers,” said Nicolas Maillard, director of the French-owned Manoir Aerospace plant in Chihuahua City, 235 miles south of El Paso, Texas.

Shiny, precision-shaped steel discs produced by the plant are shipped to companies in Ohio and Kentucky, where they are added into the assembly line for brake systems on the Boeing Co.’s commercial airplanes.

With the average cost of manufacturing labor running about $6 per hour in the city, a new era of high-tech growth is taking root.

“The real advantage is the cost of labor,” Mr. Maillard said. “In France, labor would account for about 30 percent of the cost of production on an item like this. Here, it’s roughly 10 percent, and we’re closer to the market we’re trying to reach.”

The sky’s the limit

Jose Luis Enriquez oversees Nordam Mexico, the Chihuahua City branch of the Tulsa, Okla.-based aerospace giant that specializes in making everything from airplane windows to cockpit doors.

“Right now, it might seem like we’re doing basic things. But going forward, I see aerospace in Mexico moving along a similar trend that the auto industry did 40 years ago,” Mr. Luis Enriquez said.

U.S. and European automakers have been tapping the nation’s cheaper labor pool since long before the 1994 North American Free Trade Agreement. A Ford Motor Co. plant in Chihuahua City has built 6.5 million truck engines since 1983.

“What started as parts manufacturing in the auto industry now involves design and making whole cars. This is what will happen with aerospace,” Mr. Luis Enriquez said.

“The difference is that the evolution won’t take 40 years, it will occur much, much faster because the Mexican government now knows how to develop an industry like this. It learned a thing or two from the first time around with the auto industry.”

The prediction appears close to a reality. In 2007, Mexico had 150 aerospace factories exporting roughly $2.7 billion worth of products. By last year, the number had soared to 260, with exports totaling $3.8 billion, an increase of more than 40 percent over four years.

The same period saw violence spiral in Mexico, a nation plagued by more than 47,000 drug-war killings since 2007. But the killing has done little to deter foreign companies from wanting in on the hot aerospace market.

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