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What is the history of Jabil’s presence in Mexico?

We are approaching the 20th year of our operations in Mexico. The industries that we have served in this time have been varied. We have evolved alongside industries; some of them do not even exist today. The great thing about our industry is that companies change, but the need for technology remains constant. We do not have to invest in the next wave of product technology; we just need to adjust to the product technologies that change. The core business of Jabil has been contract manufacturing. Now, we have expanded it on the front end to design services and supply chain management for our customers and on the back end to logistics solutions, such as shipping directly to customers.

What are some of the differences between the cities where you have business?

Jabil is a large company and we are in the EMS sector. This covers only 60% of the company´s revenue. In Tijuana, we have a relatively large footprint in our healthcare business, and that is doing well. We have two small businesses in Ciudad Juárez that supply plastic products to a different set of products. We find Juarez not expanding nearly as fast as Guadalajara. The past history of Juarez still remains, though the environment is very much improved. Many customers are still not comfortable going there. Also, many of our leaders that started their careers in Chihuahua are playing a big role for us now in Guadalajara. Hence, Guadalajara is really our key technical center. Chihuahua has an aerospace and automotive background where we get our technical talent pool, but it certainly cannot compete now with Guadalajara.

What differences in skill sets do you encounter in Jalisco and Chihuahua?

We are technically stronger and our managerial skills are much more refined in Guadalajara. There is much more industry here and a large pool of skilled labor, compared to Chihuahua. Technically and managerially, the talent pool is larger in Jalisco. For companies, it is much easier to operate in Jalisco; however, the downside is that there is a great deal of poaching, or talent wars, unlike in Chihuahua. The scale of the city is much different; Guadalajara is six to eight times larger than Chihuahua. Air traffic to the US is much more available in Guadalajara, so it is customer friendly. In Jalisco, the government continually checks in to see how it can contribute. There is a great partnership and relationship with the government. In Chihuahua, the government is helpful, but not on the same level.

Is there a positive relationship between the business community and the government?

We have been here working for a long time and the government has been active in giving us incentives. With seven sites and 10,000 people, our stakes in Guadalajara are growing. When we have a problem, we have a direct line of contact with the governor, which we value greatly. The government also talks about its technical innovation center and trains numerous students who can later work here.

What is your client profile?

They are mostly American and European multinationals and start-ups with potential. When we started doing business in the automotive sector in Chihuahua, it begun as one small project and now is our biggest customer in Chihuahua. We are not the least expensive solution for customers, so unless a small company has the volume, it probably would be better served with a different partner. We sell a package of services that is a full end-to-end solution for customers—that is a huge investment that comes with a huge benefit for the customer. We do not do a great deal of work with local Mexican companies. We are a top-tier EMS provider, and perhaps local businesses target second- or third-tier companies. There has been some intent to work with local companies, but nothing has materialized thus far.