In the late 1990’s, NAFTA was a trigger that motivated aerospace industry manufacturers take to look at Mexico. Multi-national businesses and mid-sized industry suppliers saw the inherent the advantages of considering cost-effective Mexican locations from which to service global markets. As a result, aerospace manufacturing in Mexico has undergone extensive growth in the last 20 years, and it continues to grow today.
Since 2004, the number of aerospace manufacturers in Mexico has ascended from about 100 to over 300. Today, just about every element of a plane can be assembled in Mexico. The Mexican Government has also established a multifaceted, robust plan that aims to amplify and advance the country’s aerospace design, development, and engineering yield, highlighting the appealing cost of Mexican labor.
The U.S. and Mexican governments recognized the emerging trend toward multinational design, production, and interchange of civil aeronautical products, prompting a desire to promote aviation safety and environmental quality while recognizing common concerns for the safe operation of public aircraft. As a result, on September 18, 2007, Mexico and the United States signed a bilateral aviation safety agreement (BASA) in Montreal, Canada.
What is the ‘BASA’?
The Bilateral Aviation Safety Agreement, or BASA, is a part of the International Open Skies Policy initiative. The U.S. and Mexico labored together for more than three years to finish this agreement. The BASA removes authorization measures for certain items that are related to the aeronautical industry in both countries. It is the reciprocated acknowledgement by the countries’ civil aeronautical authorities of certifications of aeronautical products, in turn promoting safety and environmental objectives. The Mexican Senate approved the agreement on October 8, 2009.
The application of the BASA assists the supply operations to aircraft manufacturers and their clients. One effect of the agreement is that it helps to reduce costs: the Federal Aviation Administration (FAA) no longer needs to re-authorize certifications carried out by the Mexican Dirección General de Aeronáutica Civil (DGAC). The FAA and the DGAC determined that the aircraft certification methods of each authority for the design and production approval, airworthiness certification, and ongoing airworthiness of the civil aeronautical products, parts, and equipment, are satisfactorily analogous in composition and presentation to sustain Implementation Procedures. The Implementation Procedures are based on a high level of mutual confidence in the FAA’s and DGAC’s procedural capability and regulatory competence to perform these tasks. As a result, Mexico’s aeronautical authority is now allowed to certify parts, components, and aeronautical systems. They can even complete aircrafts manufactured and assembled in Mexico that are intended for the U.S. and other aerospace markets. This improvement removes a step in the supply-chain, as products no longer have to be examined internationally before being shipped off to assembly companies, saving time and money.
How Does it Affect Aerospace Manufacturers in Mexico?
The BASA removes obstacles for an industry wanting to outsource production to Mexico. It contains provisions that will let manufacturers verify and transport machinery directly from Mexican factories, rather than sending them back to the U.S. for conclusion and security checks, therefore avoiding expensive re-certifications or secondary reviews. The BASA reduced costs particularly for companies importing parts and components to be transformed into systems and aircraft portions.
Results of BASA:
- The growth of the industry and the creation of jobs.
- Enhances the safety of air transport between the U.S. and Mexico.
- Reduces regulatory burdens for airlines and aviation authorities of both countries.
- Eliminates a step in the supply-chain since products no longer have to be inspected international before being shipped off the assembly companies.
- Reduces costs for both the governments and the manufacturers.
The Bilateral Aviation Safety Agreement between the U.S. and Mexico has further expanded Mexico’s aerospace industry. This is another major step between the two governments to increase commercial cooperation while increasing security and safety standards.