Honeywell in Tijuana: A Manufacturing Success Story 31 Years in the Making
This is part of our ongoing series highlighting Tijuana Success Stories
Hey there, industry watchers! Today, I want to talk about one of the most impressive manufacturing success stories along the U.S.-Mexico border: Honeywell’s operations in Tijuana.
A Relationship That Started Before Your iPhone Existed
Did you know that Honeywell has been in Mexico since 1947? That’s right—they were establishing relationships south of the border when most companies weren’t considering international manufacturing. However, their specific presence in Baja California began about 31 years ago, making them true pioneers of the maquiladora model in the region.
What started as a strategic experiment has blossomed into something remarkable. Today, Honeywell operates six manufacturing centers and two engineering and test labs across Baja, California. These facilities employ over 6,000 workers—nearly half of Honeywell’s Mexican workforce of 12,000 people! When a company commits that many resources to a region, you know it’s found something special.
Location, Location, Location—It Really Matters
So why Tijuana? It’s all about that prime real estate! Less than 30 minutes from San Diego, Honeywell’s facilities benefit from the busiest border crossing in Mexico. This isn’t just convenient—it’s transformative for their business model.
Imagine being able to implement just-in-time manufacturing strategies while serving U.S. markets. Need to respond quickly to changing demand? No problem when your production facility is practically next door. This proximity is something distant offshore locations simply can’t match.
Beyond the U.S. connection, Tijuana offers access to global markets through well-developed seaports, airports, and highway networks. This logistical flexibility is gold for Honeywell’s diverse product lines, which span aerospace, automation, control systems, and turbochargers.
Birds of a Feather Manufacture Together
One of the smartest aspects of Honeywell’s strategy has been tapping into Baja California’s aerospace manufacturing cluster. The region hosts over 82 aerospace companies employing approximately 28,000 workers. That’s not just a workforce—it’s an ecosystem.
This clustering creates fantastic advantages:
- Access to suppliers with aerospace-specific capabilities and certifications
- Workers with transferable skills and industry experience
- Knowledge sharing across companies
- Specialized service providers who understand aerospace needs
Honeywell didn’t just find cheaper labor—they found a community that understands their business.
It’s Not Just About Labor Costs (But Those Are Nice Too)
Let’s talk economics. Yes, Mexico offers competitive wage rates comparable to Asia, but with significantly lower logistics costs and shorter lead times for North American markets. Industry statistics suggest the average company can save nearly $1 million annually in labor costs through Mexican manufacturing operations.
Those savings compound dramatically for Honeywell, which has multiple facilities and thousands of employees. Unlike some rapidly developing manufacturing hubs, Mexico’s wage growth has remained stable and predictable, making long-term planning much more reliable.
Then there’s the USMCA advantage. Under this trade agreement, Honeywell can send equipment, supplies, machinery, and raw materials to their Tijuana plants without paying import duties. The finished products can be exported back to the United States or third countries duty-free under qualifying conditions. These tariff savings represent a significant economic advantage for a manufacturing operation with complex supply chains like Honeywell’s.
Building Something Greater Than Parts
What really impresses me about Honeywell’s approach is how they’ve evolved their operations over three decades. What likely began as simple assembly has transformed into complex manufacturing, engineering, and testing capabilities. The company has continuously invested in building local capabilities rather than merely exploiting cost differentials.
Take their 2012 launch of a new Engineering and Test Lab in Mexicali—backed by a $2.73 million investment. This facility demonstrates how Honeywell has grown its Mexican operations from basic assembly to include sophisticated engineering functions that support its global businesses.
They’ve also been smart about developing talent. Through initiatives like the Honeywell Initiative for Science & Engineering (HISE), they’ve partnered with local institutions like CETYS Universidad to inspire future scientists and engineers. These educational partnerships ensure a sustainable pipeline of qualified workers for increasingly sophisticated operations.
Navigating the Challenges
Of course, it hasn’t all been smooth sailing. As more companies recognize Tijuana’s advantages, competition for both real estate and talent has intensified. Industrial park leasing rates jumped 14% in 2023 alone, exceeding $0.80 per square foot per month.
Honeywell’s early entry into the market gave them an advantage in securing desirable manufacturing locations before this dramatic price escalation. Their established reputation also helps them attract and retain talent in an increasingly competitive labor market.
Lessons for Others
What makes Honeywell’s case so instructive is how they’ve approached their Tijuana operations as strategic assets to be developed over time, not just as low-cost production locations. They’ve combined cost advantages with operational agility and supply chain resilience—creating value that extends far beyond simple labor arbitrage.
As companies increasingly reevaluate their global footprints in light of supply chain vulnerabilities, rising costs in Asia, and geopolitical considerations, Honeywell’s Tijuana story offers a compelling example of nearshoring success. Their 31-year journey shows the long-term viability of cross-border manufacturing when executed with strategic vision and operational excellence.
So next time you hear about companies “discovering” Mexico as a manufacturing alternative, remember that Honeywell has been quietly perfecting this model for over three decades. Sometimes the best innovations aren’t about finding new territories—they’re about seeing the strategic potential in your own backyard.
Website by: