Maquiladoras (also known as “twin plants”) are manufacturing plants in Mexico with the parent company’s administration facility in the United States. Maquiladoras allow companies to capitalize on the less expensive labor force in Mexico and also receive the benefits of doing business in the United States.
What is an example of a maquiladora?
Location. Maquiladoras are mostly found in the Mexican border states of Baja California and Chihuahua . To be precise, the 6 border states of Mexico that make up the maquiladora border are: Baja California, Chihuahua, Coahuila, Nuevo Leon, Sonora, and Tamaulipas.
What is the maquiladora program in Mexico?
A maquiladora is a low-cost factory in Mexico that is owned by a foreign corporation. Facilities are usually located near the U.S.-Mexico border. These plants assemble products and export them back to the United States and other countries.
Why would a company want to have a maquiladora?
Maquiladoras receive raw materials from companies in the U.S. to assemble and export back as finished manufactured goods . ... Simply put, maquiladoras benefit Mexico because they incentivize external investment by encouraging foreign investors and businesses—especially United States ones—to set up plants in Mexico.
What did the maquiladora do?
A maquiladora (Spanish: [makilaˈðoɾa]), or maquila (IPA: [maˈkila]), is a company that allows factories to be largely duty free and tariff-free . These factories take raw materials and assemble, manufacture, or process them and export the finished product.
What companies have maquiladoras in Mexico?
- Bombardier Inc.
- EATON Corporation.
- GKN Aerospace.
- Goodrich Corporation.
- Honeywell.
- ITR.
- MD Helicopters.
What is Immex in Mexico?
The IMMEX (formerly Maquiladora ) program in Mexico offers favorable tax benefits to companies manufacturing in Mexico—especially for companies who primarily manufacture products that will be exported out of Mexico.
Which Mexican City has the most maquiladoras?
Ciudad Juarez is the Mexican city with the most maquiladoras, but these days it accounts for only about one-fourth of them countrywide. The number of maquiladoras has grown in the past few years, as a steadily devalued peso has offset the effect of high inflation on labor costs and kept them low.
Where are maquiladoras generally located in Mexico quizlet?
Explain the spatial distribution of maquiladoras within Mexico. They are located within 35 miles of the US borders. They are located all over Northern Mexico . They are located there because the infrastructure in Northern Mexico is better to attract transnational government there.
What does maquila mean in English?
: a foreign-owned factory in Mexico at which imported parts are assembled by lower-paid workers into products for export.
What are 2 drawbacks of the maquiladoras?
- Environmental negligence.
- False “paper” unions.
- Living wages near or at poverty level.
- Health risks.
- Unsafe working conditions.
- Poor labor protection laws.
- Sexual harassment.
- Inadequate housing for employees.
What are the problems of maquiladoras in Mexico?
The rapid population growth rate which has been over 12 percent compounded yearly since 1983 for Mexican cities along the U.S. — Mexico border areas has created many infrastructure problems — lack of housing, lack of potable drinking water, lack of paved roads , lack of sewage and drainage facilities, lack of ...
Why is Mexico emerging as an important location for industrialization?
c) Mexico has emerged as an important location in the current global system of industrial organization. One reason is the cheap labor found in Mexico . Another reason is the small amount of taxes and tariffs placed on imports and exports there. Also, there are not many environmental restrictions.
Who owns most of the maquiladoras?
The vast majority of maquiladoras are owned and operated by Mexican, Asian, and American companies . Maquiladoras originated in Mexico in the 1960s, with many of the plants located in the border towns of northern Mexico.
What are the pros and cons of maquiladoras?
- Location. Foreign Trade Zones offer tariff advantages and reduced paperwork. Lower distribution costs.
- Large skilled & non-skilled employment base.
- Women in the workforce.
- Political improvements; multi-party democracies.
- Economic growth. Increase workforce buying power.
What do maquilas represent in Mexican exports?
The most dynamic exporters in Mexico are in-bond assembly plants , known as maquiladoras. These plants import parts and components from abroad, assemble the inputs into final goods, and then export their output. They are most active in the electronics, auto parts, and apparel industries.
