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3rd Quarter Mexico Resort Real Estate Update
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September 29, 2011

Welcome to our third quarter 2011 newsletter. In this edition, a few comments about travel to Mexico. A couple of years ago, an owner to a small hotel in the Baja said to me, "John what the swine flu and the narco wars have not done to us, the economic recession in the United States has. Our tourism industry in Mexico has suffered immense damage from the U.S. media reports."

I would comment that, Mexico no longer has a health issue, the drug wars are limited to a small area of the country and there are people who can not only afford vacations, but are looking for investments as second and retirement homes. But the negative media stories are ongoing. In recent months, I have seen a few positive reports emanating from the U.S. One of these by Nancy Trejos of The Washington Post is included in this edition.

Mexico’s Aerospace Industry Attractive for Foreign Investors

According to a report in the Wall Street Journal, the world’s international investors in the aerospace industry find Mexico an attractive place to invest. In the past five years, the industry here had grown 20% with investments from, among others, Bombardier, General Electric and Textron. Bombardier is no stranger to Mexico. The subway cars in Mexico City’s Metro were manufactures by the Canadian company. It also manufactures its corporate jets, the most modern in the world, in Mexico.

The manufacturing center for the industry is Queretaro, Queretaro. The foreign investment in that city during 2010 was $150 million. It all started when Bombardier built its first manufacturing facility in Mexico five years ago. The company’s investment in this country since 2008 is $250 million.

The report goes on to predict a promising future of the industry in Mexico.

Mexico’s Tourism Minister Wants Americans Back

On a recent U.S. public relations swing, Mexican Tourism Secretary Gloria Guevara sat down with Travel’s Nancy Trejos talks about why Americans should keep Mexico on their favorite destinations list. Click HERE for the full story.

More Lights for Latin America’s Illuminated City

In an earlier edition of this newsletter, I wrote about Morelia, Michoacan being named as, "Latin America’s Illuminated City." This title was given by the group, Lighting Urban Community International. It all started eight years ago in the sixteenth century colonial treasure.

This year, additional monuments and buildings have been added. The project, started in 2003, has been financed by three levels of government at a cost of 107.3 million pesos. (About $ 8.1 million USD) The ex-convent St. Agustin, one of Morelia’s oldest buildings is among the buildings recently lighted.

Commenting on the new activity, Morelia's Mayor Rocio Pineda praised the efforts of the project’s engineer, Alfonso Alvarez. She commented, "The lighting of these buildings and monuments help focus on the architectural wonders of Morelia."

In other news, for the second year in a row, Morelia is hosting the International Cultural Tourism Fair. It will take place from September 29 to October 2nd. There will be more than 115 exhibitors from eleven countries and nineteen Mexican states.

Why Mazda, Nissan, Volkswagen and Honda Invest $2 billion in Mexico
Submitted by Don Bain, in a blog

Mazda, Nissan, Volkswagen, Honda have recently announced investments totaling $2 billion in Mexican plants and facilities, while Audi and Toyota are reportedly looking over the possibility of their own investments.

Mexico is quickly becoming a world leader in manufacturing, according to a recent report in the Dow Jones Newswires. Manufacturing output in Mexico is rapidly growing as evidenced by the fact the fabrication of cars and light trucks between January and June this year rose 14 percent to 1.23 million vehicles.

During this first half of 2011, Mexico's automobile production has reached a record pace due to burgeoning market demand from Latin America, especially Brazil. This is a two-quarter record for any year in history, according to the Mexican Automobile Industry Association (AMIA).

Nissan Motor Company has referred to Mexico as "one of its fast-growing markets" this year. Nissan recently announced a $1.05 billion investment in its plant in Aguascalientes. The company produced over a half million vehicles there last year and expects to boost the output of its Mexican plants by 20 percent this year. Nissan is second to General Motors Company as the largest automobile distributor in Mexico.

Further, the Volkswagen Group began production of the very first models of the redesigned VW Beetle in Puebla, Mexico predicting the redesigned "bug" will conquer new markets as a "lifestyle" vehicle, according to a recent post in The Wall Street Journal.

Volkswagen reportedly invested $400 million to re-tool the plant and VW Beetle production will keep 2,000 Mexicans at work. The company hopes to produce 100,000 Beetles by next year, 90 percent for export. The new model should be in dealer showrooms this fall.

The most recent development is Honda Motor Company’s decision to invest $8 million for a new plant in Guanajuato, as reported by TorqueNews August 15. This will create 3,200 jobs in the centrally located state, allow Honda to keep costs down and meet expected demand for small cars in the U.S. market. The maquiladora should open in 2014 ready to produce 200,000 vehicles per year. In an interview with Bloomberg, Mexico's Economy Minister Bruno Ferrari stated, "We're expecting to have more of those announcements before the year's end."

Auto exports from our Central American neighbor also increased 15 percent during the same period to a record 1.02 million units. "Production in Mexico is absolutely being driven by exports and exports continue to grow," Eduardo Solis, president of AMIA, was quoted in a news conference on the Dow Jones Newswires via FOX Business last April.

Mazda has been operating for several years already in Mexico with great success. In fact, Mazda recently announced an investment of $500 million to build a new plant in the central Mexican state of Guanajuato to build the Mazda2 and Mazda3 compact cars and engines, according to Reuters.

The plant, which will have an output capacity of 140,000 vehicles per year, will help expand the company's Latin American operations. The plant, which plans to employ about 3,000 people at maximum capacity, should be completed by 2013.

Noting the record in sales since he has moved operations to Mexico, Mazda's CEO Takashi Yamanouchi stated to Automotive Business Review, its sales results have steadily improved since October of 2005 and in 2010 the company set a new record for both sales volume and market share.

Miami Based Journalist Speaks to Guadalajara AMPI Members

More than 600 members of the Mexican Association of Mexican Realtors (AMPI) from Western Mexico met recently in Guadalajara. They came to attend the twenty first annual Forum of the AMPI Section in that city. The key note address was given by Andres Oppenheimer from the Miami Herald. Attendees at the FORO were invited to attend AMPI's Fortieth Annual Conference and Annual Meeting. It will be held in Merida, Yucatan from October 3 to 7th. Read the full story HERE.

John Glaab has been a member of NAR's International Section for over a decade. He has earned the Certified International Property Specialist designation and is a founding member of AMPI Los Cabos. He spends half the year in La Paz, Baja California Sur and the other half in Uruapan, Michoacan. For further information, contact John at John.Glaab(at)