The Mexican economy is booming, and that includes for those among the super-rich in Tierra Azteca, as some call the US’s neighboring country to the south. Opportunities abound, and there are hints of that in the economic data. For one, Mexicans – or expatriates in Mexico – are buying more private jets. For example, sales of private jets in Mexico have typically been fewer than Brazil’s, but last year that changed – a trend expected to continue as Mexico’s economy continues to grow and Brazil’s stalls.
“It’s a matter of following the money,” according to Brian Foley, a Sparta, New Jersey-based aerospace consultant. “It’s Mexico’s turn for now.” “We’re so motivated by the Mexican market that we decided to open a sales office in the country,” Breno Correa, sales and marketing director of Embraer executive jets in Latin America, told Bloomberg. “We already have one operations maintenance center in Monterrey and we’re looking at installing a second one in or around Mexico City.”
Mexico benefits from its proximity to the US, which has the world’s largest private aviation infrastructure, according to Rolland Vincent, president of Rolland Vincent Associates in Plano, Texas. For Embraer, Mexico is a major opportunity, as the firm expects to expand its 2 percent market share in the country to 16 percent in the coming years, Correa said. “Early on, preowned business jets would go into Mexico after they had served in the U.S.,” Vincent said. “That now has transitioned. It’s almost completely new purchase activity.”
Although the Mexican peso has been declining against the US dollar in recent months (making this a great time for a Mexican vacation with US dollars), the Mexican economy is definitely improving. Private jet sales are just one symptom of many. According to the Wall Street Journal:
“Mexican Finance Minister Luis Videgaray, who has gone to some lengths trying to reassure Mexicans and investors that higher economic growth will eventually occur, said the rate cut will encourage growth and investment by lowering the cost of borrowing.
The decision takes advantage of low inflation, and is consistent with what other central banks are doing, Mr. Videgaray told reporters during a visit to Portugal, noting that the European Central Bank cut rates this week and adopted other measures to stimulate the euro-zone economy.”
Here you can see the performance of the Peso compared to the Dollar:
Growth in the fourth quarter of 2014 can be attributed to retail sales, manufacturing, and construction, which represented the largest contributors to Mexican growth in the fourth quarter of last year.
“Economic growth was boosted by retail sales, manufacturing and construction. The industrial sector expanded 2.4 percent (2 percent in the third quarter), driven by a 4.6 percent increase in manufacturing (3.3 percent in Q3) and a 5.9 percent surge in construction (3.7 percent in Q3),” according to Trading Economics. What’s more, unemployment has decreased to multi-year lows. December’s official unemployment rate was 3.76%, below the previous month’s 4.53%. Since 2009, the official unemployment rate has decreased from near 6% to under 4%. This might be an admirable number for individuals in the US, who are stuck dealing with an official unemployment number of 5.5%.