What has 2023 been like for Evonik Mexico?

Current market conditions are an opportunity to develop new technologies and applications with additional competitive edges sought after by our customers, including savings improvements and sustainability properties. In times like these, we see a greater need to co-create with our customers and together work towards the de-fossilization of society. Are there any industries that Evonik prioritizes in its growth strategy?

No, we are lucky to find in Mexico opportunities to expand across all our 15 segments, from feed and food to healthcare, personal care, home care, automotive, aerospace, construction, and others. Unlike other developing economies, Mexico provides an active and diverse base of industries that is mature enough for us to grow in. The main driver, touching almost every industry, is nearshoring-driven FDI flows and the relocation of supply chains to Mexico. Nearshoring is nothing new to Mexico, where for many years, Tier 1 and Tier 2 companies especially in the automotive and aerospace sectors established a presence in Mexico. The difference now is the level of sophistication and tech-driven facilities being built across a wider range of industries, from automotive and aerospace to electronics, personal care, and home care. The USMCA (The United States-Mexico-Canada Agreement), but also geopolitics and the pandemic, pushed for a rethinking in the organization of supply chains, and Mexico stands out as an attractive destination. How ready is Mexico to absorb and respond to more manufacturing and export activity?

There is no free lunch with nearshoring. Mexico will need significant investments in the areas of security and transport infrastructure to be able to keep up with the growth we expect to see in manufacturing and exports. Sooner or later, we may also see issues in terms of talent availability. We also need more industrial parks and warehousing capacity to support the distribution of products within and out of Mexico, mostly in the northern and central parts of the country. Could you comment on the availability of high-skilled labor required in advanced manufacturing in Mexico?

Mexico has the classic social pyramid of emerging economies, with a large share of its 120 million population being of working age. This offers a broad talent pool and a strong pipeline for the future. However, we need more educational and training programs because the skills required in the future may not be the same as those required today. The private sector must continue developing local talent by executing dual programs (formal education combined with internships). Our training initiatives as a country cannot lose sight of Industry 4.0 and digital tools. What do you see as a long-term solution for Mexico’s feedstock constraints?

The Mexican chemical industry is running today at only around 60 to 70% capacity, so this year, at ANIQ, we went through a national exercise of rethinking the best path for the future of the industry. We ended up suggesting ways in which the private sector could work closer with the authorities to secure the necessary raw materials, but also to grow further especially when it comes to alternative energy sources as our customers go under more pressure in end-markets like North America or Europe. The private sector could even make contributions to existing assets to bring them up to speed in a sustainable way. Out of this systematic dialogue, we made progress in some areas, but not all. Evonik Mexico celebrates 120 years in 2023. Do you have a final message for APLA and GBR on this occasion?

We have multiple celebrations this year: We celebrate 120 years since our German company first started with precious metals refining and trading in Mexico, in 1903. We also celebrate 75 years of one of our predecessor companies’ active manufacturing in Mexico, as well as 55 years of our legacy Degussa opening the first office in the country. These show the great commitment made to the Mexican economy from the early days of gold and silver mining to today’s modern manufacturing, applied technology labs, and R&DI activities. I am happy to be leading this 150-person organization in Mexico and be part of the North American platform, which is the largest outside of Germany.