Nuevo León Manufacturing at Year-End: Contraction and Challenges

During November, the Economic Expectations Survey by CAINTRA confirms that Nuevo León’s manufacturing sector continues to contract. Key indicators remain below the expansion threshold. Furthermore, weak economic activity is influencing production, investment, and pricing decisions within the sector.

How Did Production and Capacity Utilization Behave?

Firstly, capacity utilization registered 43.06 points, its most recent lowest level. This result deepened the contraction compared to the 46.07 points observed in October. The data reflects reduced utilization of industrial plants and lower operational intensity.

In parallel, the new orders index decreased to 41.65 points. This level positioned it as one of the furthest from the expansion threshold. Consequently, the

face reduced immediate demand. Similarly, lower orders directly impacted the physical volume of production. This indicator fell by approximately 1.4 points, settling at 43.44 units. Furthermore, inventories and imports also showed declines, confirming a widespread slowdown.

Employment Records Slight Advance

Unlike the production indicators, the number of

showed a slight rebound. During November, the index advanced by 0.61 points. However, the level remained below 50 points, the threshold for expansion. This behavior suggests corporate caution. Companies are maintaining their workforce but avoiding aggressive hiring. Moreover, this adjustment responds to uncertainty regarding future demand.

What Happened with Product and Raw Material Prices?

On the other hand, regarding prices, the survey shows mixed behavior. The product price index fell to 48.8 points, indicating contraction. Companies face difficulties in passing costs on to the final consumer.

In contrast, raw material prices continued to expand. This indicator reached 56.82 points, reflecting constant pressures on inputs. Consequently, operating margins remain under pressure.

Another relevant data point concerns investment. Only 18% of companies reported investing in machinery or equipment during November. This proportion decreased compared to the previous month. Furthermore, it represented the second lowest figure of the year.

What Were the Main Obstacles for the Industry?

The survey indicates that the factors hindering manufacturing companies reinforce the diagnosis of a slowdown in November. Responses highlight an environment of caution and reduced economic dynamism. These are the main obstacles:

Weak economic activity: mentioned by more than half of respondents, with a 9.3 percentage point increase compared to October.
Political outlook: present in 43.3% of responses, although it no longer topped the sector’s concerns.
Shortage of skilled personnel: indicated by 14.2% of companies, with lower incidence than in previous months, but still within the top 7 obstacles.

Collectively, the November results confirm that Nuevo León’s manufacturing sector is undergoing a period of adjustment. The evolution of demand and the economic environment will shape the sector’s performance in the coming months.