The council wants to bring production back to El Paso

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The nonprofit economic development organization introduces El Paso’s security and logistics to businesses uneasy about the violence in Juarez

EL PASO, Texas (Border Report) – Historians and labor lawyers recall that El Paso was once a major apparel manufacturing center in the Southwest. Farah Inc., for example, operated five factories in El Paso employing at least 3,000 people, according to the Texas Stated Historical Association.

But labor costs and other issues caused manufacturers to look across the border. Most of the major assembly plants in the area are now in Juarez, not El Paso. Now a group of local entrepreneurs is trying to attract new industry – and new jobs – north of the border, and their leaders say the time is right.

“Unfortunately, there is a lot of violence in Mexico, so manufacturing companies are thinking twice before building in Mexico,” said Sergio Castaneda, president of the nonprofit El Paso Trade and Manufacturing Council. “They’re running out of space in Juarez, so[companies]aren’t looking for growth in either southern Mexico or El Paso.”

The leaders of the two-year-old nonprofit plan not to take existing jobs away from Juarez, but to give manufacturers from the Midwestern United States another reason to come to the region in Europe.

“There is land in El Paso that we can use to create opportunities for manufacturing companies. That’s our main goal, to convince them that El Paso is in a great situation. We’re on the border, we’ve got 2.2 million people between Ciudad Juarez and El Paso,” Castaneda said. “If we convince them that the geography, the (availability of) land, the safety — El Paso is a very safe city with a great environment to live in — that creates tons of jobs, tons of growth” for the region.

El Paso already has a very active Borderplex Alliance trade promotion group, which over the past few years has worked with city and county leaders to attract companies like Amazon, TJ Maxx, and Schneider Electric. Across the state line in Santa Teresa, the Border Industrial Association has helped transform a patch of desert into one of New Mexico’s fastest growing economies.

The El Paso Trade and Manufacturing Council is trying to carve out a niche that focuses on manufacturers.

“We are an organization founded by local stakeholders with 100 years of experience in the industry. We came up with ideas and saw an opportunity because we have 10 to 20 manufacturing facilities in El Paso; in Juarez they have about 400.”

The biggest obstacle for manufacturers choosing El Paso over Mexico is labor costs. The minimum wage in Texas is $7.25 an hour; in Juarez it is $8.60 per day.

Castaneda said he is aware of the differences, but his more than two decades of experience in transport and logistics make him confident the group’s goal is achievable. El Paso has some of the most efficient shipping companies in the country, and there’s the benefit of not having your goods waiting hours on the Mexico side awaiting clearance at US ports of entry.

“We have options with transport costs, which saves a lot of money,” said Castaneda. The components assembled in Juarez “must be sent back for (further) refurbishment. This means costs in transport and costs in the supply chain. If a factory settles here in El Paso, it will supply the maquiladoras just across the border. Now we produce here, we create jobs here, we create growth here and we help the maquiladoras across the border. Together we will become a larger region.”

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