Abstract
The maquiladora program was established by the Mexican Government to encourage foreign investment and promote industrial growth. The success of the program encourages more and more participation each year. The low cost of labor in Mexico has attracted U.S. companies in all types of manufacturing with the exception of shipbuilding. With the focus on the domestic shipbuilding market over the past 25 years, U.S. shipyards have lacked the impetus to establish a maquiladora operation. The world market for shipbuilding has been steadily improving, while the U.S. domestic market has been steadily decreasing. The opportunities for U.S. shipyards to focus their strategies on the world market may not get any better. By understanding the complexities of establishing a maquiladora operation and then integrating the operation into its overall production plan, a shipbuilder can begin to realize that large labor cost savings are possible.
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