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TMASC Blog Archives

Oct 29

Texas Income Growth Counters National Trends

Posted on October 29, 2014 at 2:56 PM by Rebeka Gresham

Growth in the Lone Star state continues, as the population swells with new arrivals seeking business opportunities and an economic environment that has weathered the recession remarkably well.

One recent arrival pens a telling tale of Texas’ relative stability and prosperity in decidedly difficult economic times:

Our new home in Dripping Springs, about 25 miles outside of Austin, may be the “Gateway to Hill Country”— to the stunningly beautiful rolling countryside that extends from Austin down to Kerrville, Junction and beyond— but it’s also in the heart of what I’ve called “Dal-Antonio.”

That’s the developing megopolis of Dallas, Austin and San Antonio. This area is to Texas as “Bos-Wash” is to the Northeast or “Chi-Pitts” is to the Midwest. [...]

It also accounts for three of the six major metropolitan areas with the fastest growing personal income in the United States. Add Houston, which is first on the list, and Texas is the heartland of growth in America in a year of shock, misery and loss.

Energy contributed, but it isn’t the whole story.

In case you haven’t seen the Bureau of Economic Analysis list of Personal Income for Metropolitan Areas, here’s how major cities compare. While Houston, Austin, San Antonio, and Dallas experienced personal income growth of 6.3 percent, 5.4 percent, 5.4 percent, and 4.6 percent, respectively, in 2008 the average U.S. metropolitan area was growing personal income at only 3.3 percent.

In fact, while the energy sector remains an important part of the Texas economy, many of the “Key Industries” identified by the Governor’s office are fueling Texas’ rapid growth in development, jobs, and wealth creation.

Among these industries is, of course, advanced automotive manufacturing.  One need look no further than this map (courtesy of this GIS tool) to see the saturation of automotive manufacturers and suppliers throughout the state of Texas, forming part of the TMASC supply chain:

Oct 29

Mexican Government Considers Amendments to 2003 Automotive Decree

Posted on October 29, 2014 at 2:52 PM by Rebeka Gresham

According to the latest CCN Mexico Report (an excellent resource; sign up for free monthly updates here), the Mexican government is reviewing proposed changes to the 2003 Automotive Decree.  CCN explains that the 2003 decree “provides incentives to foreign automotive assembly companies operating in Mexico, so long such companies meet certain investment requirements, notably the annual production of at least 50,000 units within Mexico.”  The proposed amendments–currently under review by the Federal Commission of Regulatory Improvement–would target incentives at companies meeting the following criteria:

  • Producing new, light vehicles
  • Producing at least 50,000  units in Mexico during any of the previous 3 years
  • Producing at least 30,000 units in Mexico during the previous year
  • No suspensions of production lasting more than 3 consecutive months in the previous year
  • No decrease in production larger than sales declines in domestic markets (where at least 90% of units are sold)

CCN reports that prospects for passage of the changes looks good:

The automotive industry has expressed its approval of such amendment, thus, the expectation is that the Executive Power will approve the proposed amendments and announce their immediate implementation in the Official Gazette of the Federation (“Diario Oficial de la Federación”).

These changes could help attract additional foreign investment in the TMASC region and strengthen the network of OEMs and suppliers on both sides of the border.

Tag(s): OEMs, Mexico

Oct 29

Defend Texas Jobs in Sealy

Posted on October 29, 2014 at 2:50 PM by Rebeka Gresham

BAE Systems’ plant in Sealy, Texas faces a very real and frightening threat of closure based on the U.S. Army’s recent decision not to renew a contract for the Family of Medium Tactical Vehicles (FMTV) manufactured at the Sealy plant since 1992.

The Army recently announced a new contact with Oshkosh Corporation in place of a renewed contract with BAE Systems and the 3,000 experienced Texas workers currently manufacturing the FMTV.  BAE is protesting the contract decision, citing a faulty bid process.  You can learn more here.

Through 17 years of production experience on the FMTV, BAE has incorporated supply chain and manufacturing efficiencies that lower the production turn-around time without compromising quality: the vehicles produced by BAE Systems earn the Army’s “ultra reliable” descriptor.

The presence of BAE Systems in Sealy creates a ripple effect of manufacturing activity and job growth that extends beyond the estimated $500 million that FMTV production contributes to the Texas economy. The Sealy plant lies at the heart of the strong and growing Texas-Mexico Automotive Supercluster (TMASC) region, where nine global consumer, industrial, and military vehicle producers and over 200 parts suppliers manufacture almost 900,000 vehicles per year and employ over 151,000 workers. BAE Systems is one of the anchor original equipment manufacturers (OEMs) in this cluster; losing the Sealy plant would have a detrimental effect on other manufacturers who rely on common suppliers and economies of scale for competitive pricing.

Saving the Sealy plant would obviously and directly benefit the thousands of hard working Texans who have assembled these vehicles with pride for almost two decades.  But the Sealy plant is also extremely important to vehicle manufacturers and suppliers across the TMASC region that face negative “ripple effects” if this contract decision stands.

Please do your part for Texas workers and our region by contacting military and congressional leaders through