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Mexico 2014 | INDUSTRY & MINING | INTERVIEW

What is the significance of the Mexican market for Airbus Group?

Frédéric García
BIOGRAPHY
Frédéric García holds a Master’s degree in International Project Management from the École Supérieure de Commerce de Paris (ESCP), as well as an Engineering degree from the École Nationale Supérieure d’Arts et Métiers (ENSAM). He has been CEO of Airbus Group for Mexico, Central America, Colombia, Ecuador, and Peru since 2009. Since 2007, he has also been Chairman of Airbus Defense & Space Mexico and a Board Member of Airbus Helicopters Mexico. From 2004 to 2009 he was CEO of EADS Mexico.

What is the significance of the Mexican market for Airbus Group?

Mexico is a particularly important and interesting market. Over the past 10 years, we have sold 186 aircraft in this market to three airlines: Interjet, Volaris, and VivaAerobus. Our forecast for Mexico is also impressive. According to the global market forecast published annually by Airbus, over the next 20 years Mexico will require 634 aircraft of more than 100-seat capacity. That is a huge market for us, and also in terms of homeland security, civil defense, and defense. On top of that, what is interesting about Mexico is that it has a growing industry; its aerospace sector has grown at an average of 15% per annum over the past decade, and 20% over the past five years.

What are your expectations for the coming years?

If we look at our presence here directly, we generate about 380 direct jobs and about 5,000 indirect jobs with suppliers. The employment potential of the aeronautics industry is particularly compelling, especially for qualified technicians. The target is to develop this over the next few years, and we aim to be employing around 10,000 people indirectly by 2020.

How does this plant contribute to regional development?

When we invest in a country, many of our suppliers are keen to invest as well; in that sense, we are in a position to boost the sector broadly. This is crucial for the future of aerospace in Mexico. In fact, we work in an industry of very few major players. For aircraft of over 100-seat capacity there are only two. If we look at the financial figures of 2013, the total backlog of our group was €686.7 billion on December 31, 2013. This means that our Group, in terms of backlog, represents more or less half of Mexican GDP. For a country like Mexico, having a strong relationship with a Group like ours is therefore key to the future development of its aeronautic industry. We contribute investment and push our supply chain to be part of Mexico, and also invite others to participate here. We enjoy a very good relationship with ProMéxico. We are working closely with the Mexican authorities to promote the Mexico of today, and the opportunities to invest here for tomorrow.

How do you feel about the energy reform?

I would say that our Group was highly impressed by the efforts of the current administration and the congress in 2013. Being able to achieve labor, telecoms, education, fiscal, financial, and energy reforms in just one year requires a highly mature political environment. We see the energy reforms as the best tool to increase national competitiveness by reducing domestic energy prices. I believe that the real challenge for Mexico is to not be competitive against China or India, but to remain competitive with the US. In my opinion, the energy reforms will contribute to this. Due to the low cost of energy in the US, it is booming again. It is a manufacturing economy, and Mexico has to be part of that and remain a key player for the US. This will be the direct impact of the energy reforms. Without doubt, if the energy reforms can increase GDP by 2% per annum, it would enhance economic performance notably. We are enthusiastic about what is happening in Mexico, and I am personally convinced that this is Mexico's moment.

How will Mexico's trade relationship with the US develop?

The two economies are connected to such an extent that this will surely follow, and Mexico is also extending bridges with other continents, such as Europe. Our company is proof that links with Europe are growing. Don't forget that the Airbus Group is really a European company with French, German, and Spanish participations, as well as UK interests. The success of Airbus in Mexico confirms the many bonds between Mexico and Europe.