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Mexico surges to 2nd Largest Medical Device Exporter in Latin America, #5 Worldwide Outpacing Competitors Costa Rica and China

Mexico surges to 2nd Largest Medical Device Exporter in Latin America, #5 Worldwide Outpacing Competitors Costa Rica and China

Shelter Services firm CPI notes that Skilled workforce, proximity to U.S. and Canadian markets make Tijuana/Baja the hub of Mexico’s medical device manufacturing, outpacing competitors Costa Rica, China

CPI visited our plant in New Hampshire to get an excellent understanding of what we do, how we do it, the space we needed, and the level of expertise required by our labor force.– Ben Prime, Technical Manager, medical device manufacturer Phase 2

Mexico, already the second largest medical device market in Latin America, is projected to grow at a compound annual growth rate of 13.4 percent, making Mexico one of the fastest growing markets in the world, according to a recent report by financial research company BMI.1 The firm estimates medical device manufacturing will grow from its estimated 2013 value of $3.9 billion to $6.9 billion by 2018.


The hub of Mexico’s medical device manufacturing is the Baja California region, contributing 50 percent of Mexico’s medical device manufacturing. Major U.S. medical device companies in Tijuana include Nelcor Puritan, Becton Dickinson, Medline, Medtronic, DJ O and Teledyne Medical.
Tijuana is just 25 miles south of San Diego. With its proximity to U.S. metropolitan areas and transport routes, Tijuana is a near-shore manufacturing and processing center for U.S. companies, not only in medical devices but also in aerospace and a number of other industries.
Mexico and its Tijuana/Baja area compete with China internationally and Brazil and Costa Rica in Latin America. At one time, China had a significant labor advantage over Mexico, with Chinese labor costs priced at a fraction of Mexico wage levels. In recent years, however, that gap has narrowed dramatically: Mexican wage levels are approximately 14 percent higher than Chinese levels.
In Latin America, Brazil is the largest medical device manufacturer. However, the majority of Brazil’s manufacturing is for domestic consumption.1 The Costa Rican government, on the other hand, has actively positioned their country as an alternative to Mexico for U.S. companies, touting the presence Hospira and Boston Scientific. Costa Rica’s medical device industry has grown to a current level of approximately $1.3 billion USD, with a workforce of 12,500.
While Costa Rica is a competitor, the Baja California, Mexico medical device industry is far larger and has a more highly skilled workforce. More than 70 medical device plants are in Tijuana, served by a 50,000-person workforce with deep roots in the medical device industry - Tijuana has been the near-shore location of choice for medical device manufacturers for close to 30 years, a development accelerated by the North American Free Trade Agreement (NAFTA).

Recent expansion by OEMs and component manufacturers to Costa Rica has resulted in scarcity of labor and real estate, with prices going up accordingly,” said Adam Prime, Chief Executive Officer of medical device manufacturer Phase 2.

The other complication was the discovery that product shipped from Costa Rica would spend 18 days on the water. Phase 2 opted for Tijuana, where they recently opened a 30,000-sq-ft facility in Tijuana that includes a 3,000 sq-ft ISO Class 8 cleanroom.

Whether moving cross the state or to a bordering country, launching a new manufacturing facility can be a daunting task. Fortunately, “shelter services firms” like Co-Production International (CPI) provide specific know-how to remove barriers and make the new site pencil out.

    • 01A company like CPI takes a consultative approach, meeting with the manufacturing company’s principals and operations team.
    • 02Based on the medical device manufacturer’s specific requirements, CPI does site exploration and gauges the availability of energy, water, shipping and manpower.
    • 03Upon approval of CPI’s recommendations, CPI then manages the construction process, from land purchase or leasing, to licensing, to contracting with reputable companies for the build-out or build-to-suit.
    • 04Once the new facility is ready, CPI provides a complete admin team to manage daily operations.
    • 05Since the Tijuana area has an ample skilled workforce, including a large number of science and engineering professionals, CPI can move quickly to have the new manufacturing facility up and running.
    • 06The U.S. Company typically is involved in the screening process for skilled hires and provides operations and financial oversight; CPI does the rest.

Phase 2 was set up in Tijuana in months, and the only way it was possible was through the efforts of CPI,” said Ben Prime, Technical Manager of Phase 2, a medical device contract manufacturer. CPI visited our plant in New Hampshire to get an excellent understanding of what we do, how we do it, the space we needed, and the level of expertise required by our labor force.

logoCPI500About Co-Production International

Strategically headquartered in San Diego, CA, CPI is the premiere Administrative Services Provider for companies seeking facilities in Mexico. CPI’s Shelter Program manages the entire array of services to launch a new facility as well as the day-to-day administration once the facility is in operation, all within the guidelines of Mexican regulations. CPI clients can thus do what they do best: focus 100% on efficient, quality manufacturing.

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Co-Production International, Inc. Administrative Service Provider San Diego, California

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Ph: 619.429.4344 / 855.480.0837
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