Mexico - R. Safety and SecurityMexico - Safety and Security
The sale of both safety and security equipment and services represent terrific opportunities in Mexico, making this a best prospect industry sector for this country. This section includes a market overview and trade data.
The safety and security market shows strong demand for products and services by government, private enterprise, and consumer buyers. For purposes of this report, ‘security’ means preventing and responding to criminal threats. By ‘safety’ we mean addressing risk of accidents, workplace protection, and natural threats.
The safety and security sector includes equipment, solutions, and services used for public security, personal protection, residential security, industrial safety, corporate facilities, and infrastructure protection (access control, ID, perimeter security), as well as diverse solutions and systems designed for law enforcement and defense usage.
New technologies have entered the market in response to security trends and consumer habits. Increased demand in this sector accelerates competition among suppliers, but it is also driving more sophisticated buying decisions and interest in advanced solutions. The security market reflects the local conditions present in the country in terms of its large population at urban centers, development levels, public security policies, and strength of local and state authorities. There are many additional factors in the country’s evolving approaches to rule of law, from historic attitudes and education levels to criminal justice reform and law enforcement challenges.
The following tables provide the most recent estimates indicating approximate market size for the range of safety and security products and services in Mexico.
Mexico Safety and Security Products and Services Market Size Estimates
(Figures in USD billions)
*Total market size = (total local production + imports) - exports
Source: Global Trade Atlas 2018 / June
Note: The safety and security equipment and services sector encompasses several different segments, including some defense products.
Mexico is one of the most important security markets in Latin America due to its size, leading industries, development, and total demand. Moreover, security is one of the most dynamic sectors in the economy. Since 2015–2016, sales of security systems and solutions have grown, on average, about 10 percent according to domestic industry figures, far outpacing growth in the overall economy. However, in 2018 and the first half of 2019, market growth slowed as both government and private sector decisions on purchasing paused due to the Mexican federal election and awaiting implementation of planned changes by the new Mexican president, Andres Manuel López Obrador.
With an upturn in violent crime and ongoing supply chain threats in recent years in Mexico, safety and security remain a constant concern for the general public, companies, and all levels of government. Security spending is some aspect of nearly all household and organization budgets. In 2018, analysts highlighted declining security as the top factor that could limit the country’s economic development. Mexico’s National Statistics and Geographic Institute (Instituto Nacional de Estadística y Geografía or INEGI) annually prepares a National Survey of Victimization and Perception About Public Security (known as ENVIPE for its acronym in Spanish). The latest report published September 2018 shows that 64.5 percent of Mexicans consider insecurity and crime the most important problem affecting their cities.
Sales in this sector have grown across end-user segments. The 2018 national security portion of the Mexican federal budget—which includes all the principal law enforcement agencies and the Mexican Secretariat of Defense—grew to USD 7.7 billion over USD 5.6 billion in 2017. This includes plans to improve security through the creation of a new National Guard.
Private sector spending drove purchasing growth in this sector. This was due to certain factors, such as the spread of crime, limited public security resources, expanded private sector actions to protect assets, higher civic consciousness, and the widespread recognition of shared citizen and corporate responsibilities in crime prevention and education.
A major development in 2018 was the new administration’s announcement of the National Peace and Security Plan 2018-2024 (Plan Nacional de Paz y Seguridad), which includes eight specific areas of action to address Mexico’s security challenges:
During the first months of 2019, the López Obrador Administration worked with the Mexican Congress to ratify creation of the National Guard, to approve several changes to the Mexican Constitution, and to enact new laws necessary to implement the National Guard and changes in the structure of public security operations in Mexico. In addition, the Government announced the leadership of the National Guard as well as a new Secretary of Security and Citizen Protection (Secretaría de Seguridad y Protección Ciudadana or SSPC) in the Cabinet, a position now completely independent from the prior placement of this role under the National Commission of Security in the Secretariat of the Interior (Secretaría de Gobernación or SEGOB).
The National Guard itself is an entirely new body that has been authorized and budgeted to include 72,000 or more personnel by the end of 2019. To stand up the force swiftly, the Government will draw 18,000 or more units from the Federal Police, 8,000 from the Navy Military Police, and 34,000 from the Army Military Police. Some officials familiar with the longer-term plan say that the ultimate size of the National Guard is envisioned to exceed 300,000 by 2024. The Guard’s Commander is recently retired Army General Luis Rodriguez Bucio. The Guard has been authorized with strictly a civilian command, but the appointment of Gen. Rodriguez Bucio solidifies the Guard’s ties with the Mexican Army. Further, the Guard has an Operational Coordination system composed of three top chiefs from the Federal Police, the Mexican Army, and the Mexican Navy.
We noted that the Security and Peace Plan establishes 266 Coordination Zones (Coordinadas) across Mexico into which Guard units will be deployed. The Guard will commence operations in 150 of the Coordinadas in 2019. In 2020, the plan is to deploy additional units to 50 more Coordinadas (for a total of 200 deployed zones), and by 2021, Guard forces are expected in all 266 Coordinadas. As a result of a joint Mexico-U.S. declaration in June 2019, the Guard has deployed 6,000 units to Mexico’s southern border area. The Guard also has initiated a rapid deployment to the State of Jalisco.
In 2019, Mexico’s public security strategy is likely to evolve as the Guard’s deployments and other aspects of the security plan take shape, as well as any delays in budget and spending authorizations. The reform of the jail system reform and the other six areas of action already mentioned will demand attention, resources, and results. Both the public sector and private security market will continue demanding solutions to reduce security risks at different levels, particularly to contain and eventually decrease kidnapping, homicide, extortion, robbery, assault, and other high-impact crimes frequently connected with the illegal drug trade.
For purposes of this report, the security sub-sector consists of goods and services responding to criminal threats. The safety sub-sector is for goods and services addressing risk of accidents (and certain emergencies), manufacturing protection standards, and some natural threats (such as fires, floods). As in the United States, we further segment the market between government, private enterprise, and consumer end-users.
The country’s security challenges and official policies influence market trends and developments. For reasons we detail below, we anticipate increased demand in several product and service categories. These include private security services, armored cars/vans, robbery prevention, CCTV, communications technologies, and cyber security solutions linked to IT applications. Mobile technologies and internet-connected devices have spread to advanced security applications, forcing organizations and individuals to replace older systems and adopt new security practices.
Personal and Household Security. As noted in the overview, INEGI conducts an annual survey of public security perception (ENVIPE, for its Spanish acronym). According to the latest survey data from September 2018, it is estimated that household security spending represents 1.65 percent of the GDP, and 25.4 million people were victims of a crime. In addition, 30.1 million crimes took place in Mexico during the survey period (keeping in mind that one person can be subject to more than one crime). The main crimes were assaults and robberies in public spaces (28.1%), extortion (19.6%), fraud (13.6%), and partial and total vehicle robberies (11.4%). Moreover, when asked about the top problem in their state, 64.5 percent of respondents cite “lack of security and criminality” as the top problem, followed by inflation, unemployment, corruption, health issues, poverty, and injustice.
INEGI also compared survey responses to official crime reports and noted that only 10.4 percent of crimes were officially reported to law enforcement agencies, implying that 89.6 percent of crimes were unreported or without investigation. The INEGI survey also shows how perceptions of crime vary by state and by city. The riskier cities based on the survey are Hermosillo, Puebla, Acapulco, and Tapachula. The more dangerous Mexican states based on survey responses were Baja California, State of Mexico, State of Mexico City, Sonora, Jalisco, Tabasco, and Guerrero.
Business Security. Even though security data varies slightly depending on sources used, it is estimated that private sector companies dedicate 10–12 percent of total spending on security equipment. This spending is mainly used to enhance facility and asset protection, such as robust alarm systems, employee / contractor / visitor identification tools, CCTV systems, and high-quality perimeter protection. Other top categories are cargo theft surveillance, GPS mobile tracking systems, better logistics communications, and emergency applications. Recently, the business organization COPARMEX stated that 57.9 percent of its members have fallen victim to a security-related crime, and the organization has demanded stronger government action against crime and insecurity.
Corporate perceptions are tracked in an annual security report prepared by the American Chamber of Commerce (AmCham). It is based on a survey of more than 300 local and multinational firms based in Mexico. In the most recently published 2017-2018 survey periods, the top private sector security incidents were these six (percentages represent number of companies reporting incidents):
Other incidents reported in the double-digits were information leaks, vandalism, and cyber-attacks. Direct extorsion reached 9.6 percent and represents a serious recurring security problem for private companies.
AmCham’s security report showed that companies were increasingly addressing external threats by adopting internal security measures using their own resources. These security measures included safety management systems; risk assessment and prevention planning; crisis management and business continuity planning; employee security awareness; improved hiring process screening; and implementation of executive protection programs. Overall, the AmCham survey respondents state their core spending is focused on risk analysis, trip protocols, physical security training, security awareness, and crisis management actions. The report underlined that today only 53.9 percent of the companies surveyed have a security department specifically for physical assets. AmCham’s 2019 Security Report will be available in late 2019.
CS Mexico monitors security developments based on issues reported by private firms and incidents reported in the news media. Among the concerns we follow have been railroad attacks to commit large-scale robbery of shipments, illegal tapping of oil and fuel pipelines, highway blockades and assaults, kidnapping, and cyber-attacks. In 2018-2019 the new administration launched an initiative to halt gas and oil theft, an illegal activity called “huachicol.”
Industrial and facility safety protection is significantly higher than household safety and generalized civil protection (i.e., more money is spent on fire suppression systems in commercial buildings than on home smoke alarms or fire department equipment). There continues to be significant evolution of new safety standards to protect lives, improve workplace environmental conditions, reduce labor risk levels, and to create an industrial safety culture. For this reason, this section focuses on business and government purchases for facility and employee safety. The U.S. Commercial Service in Mexico can assist U.S. exporters with other types of consumer safety and civil protection, and we offer market research on these sub-segments as well.
Workplace Protection and Safety. Workplace safety is a major concern. The Secretariat of Labor and Social Oversight (Secretaría del Trabajo y Previsión Social or STPS)—with data from the Mexican Institute of Social Security (Instituto Mexicano de Seguridad Social or IMSS)—reported more than 270,600 work accidents and risks nationally in 2018. The industries that have recorded the most accidental deaths are transportation (driving heavy-load trucks), construction, metalworking, mining, textiles, stores and warehouses (lifting heavy weight), and delivery services (i.e., messengers riding motorcycles).
According to Mexico’s Secretariat of the Economy, Mexico has more than four million enterprises, of which micro and small firms represent 99.8 percent, and they contribute 42 percent of GDP and 78 percent of total employment. Private sector spending on safety is dominated by multinational firms, which must follow international safety standards and have resources to provide training, programs, and emergency responses. OEMs and large companies in most major are familiar with safety regulations, such as NFPA, OSHA, NEC and the United Nations Globally Harmonized System of Classification and Labelling of Chemicals (GHS/2003).
STPS requires all manufacturing plants and companies to comply with official Mexican safety standards (NOMs). STPS performs regular safety audits on these larger types of enterprises. Nevertheless, STPS does not have the resources or inspectors to perform regular safety audits on every company, nor are they able to keep the current NOMs up to date or adopt new ones from the United Nations GHS. Regularly, the STPS conducts industrial safety consultations at the national level to examine safety-related NOMs such as NOM-011-STPS-2001, NOM-015-STPS 2001, and NOM-020-STPS-2011. New international standards and more technical training for large employers have also been promoted by associations and safety experts looking to expand their services for auditing safety standards and consulting on best practices and procedures.
Consumer Safety and Micro and Small Enterprise Safety. Unfortunately, Mexico’s four million micro and small businesses generally neglect the importance of workplace safety policies, making them a less attractive target market for U.S. exporters. The same is true of general consumers. For the most part, we see these small market sub-segments purchasing low price, low quality products that are manufactured in Asia or locally. For instance, many buyers will purchase simple, small fire extinguishers rather than more extensive fire suppression systems, and cheaper fire-retardant fabrics rather than materials with higher fire protection ratings such as Kevlar.
Civil Protection. Civil protection is constrained by government budgets and policy, making this segment a less dynamic market than might otherwise be assumed. However, regular earthquakes remind authorities, organizations, and citizens about the importance of effective emergency preparedness and response plans. The most common types of accidents and natural disasters in Mexico are earthquakes, volcanic explosions, gas explosions, fires, floods, and hurricanes. Emergency and first-aid kits are part of the regular equipment acquired by many organizations to be prepared, as well as conduct of regular emergency drills.
The federal program for natural disaster response is the responsibility of the Mexican Secretariat of National Defense (Secretaría de la Defensa Nacional or SEDENA) under its Plan DNIII, so this market sub-segment is part of the overall defense budget (USD 6.1 billion in 2019). On the civilian side, firefighters, civil rescue organizations, and the Mexican Red Cross generally depend on grants and donations for equipment and assets rather than government budgets. In recent years, both the Federal Government and state authorities have reinforced civil protection units. Coordination among rescue groups and governments has improved, civil protection is attaining wider coverage, and protection plans are better known by citizens. There may be specific opportunities for U.S. exporters, but be aware that agency resources are limited with respect to expensive equipment.
There is also need for increasing expenditures on residential and corporate fire prevention. Although building construction standards imply solid safety rules, Mexico has had safety incidents due to human errors. Firefighters in Mexico received better wages in 2018 versus prior years, but in some small communities they work on a volunteer basis. The Mexican Firefighters Association estimates that there are 14,000 firefighters nationwide (2017), but only 50 percent receive a salary. In Mexico City the number of firefighters is still small for the size of the city (around 2,100 firefighters in 2017). Higher education and regular training are not common among fire crews. The federal Civil Protection Unit of SEGOB regulates firefighters and emergencies at a national level, and each state and municipality manages and budgets its own civil protection unit and local firefighters.
At the same time, Mexico is moving towards better public safety communications and warning technologies. In January 2017, Mexico completed implementation of a national 911 emergency number system. Responses to medical, security, rescue, and fire emergencies are timelier, though false reports through the 911 system are still a problem. Missing children are also reported through an “Alerta Amber” program based on the U.S. Amber Alert. Media channels broadcast the alerts, and the program has successfully located lost children. Some opportunities exist at the municipal and state levels for monitoring and emergency response technologies. For instance, Mexico City has a network of more than 15,000 video cameras in operation, and there is significant local attention across the country to command, control, and communications centers for emergency response. Some states have created command centers to improve police response times and security surveillance.
The U.S. Commercial Service Mexico is happy to assist you in exploring opportunities in the safety and security market here. This section highlights specific opportunities in both sub-sectors. Business opportunities are mainly in medium-sized and large urban areas, and potential suppliers should prepare an effective market entry strategy. This strategy should keep in mind local and foreign competitors, address changing consumer preferences and worries, and make available complete after-sales service. In general terms, U.S. security products have a good market reputation, and end-users are familiar with U.S. brands and market trends, but other large foreign firms provide stiff competition. Potential suppliers should become familiar with Mexico’s geographic markets by visiting and attending commercial events around the country. After-market service and system warranties can make a difference in gaining advantage over other suppliers. Suppliers should also consider how mobile security applications are impacting buying habits and modifying end-user expectations and demand.
The scope of security and safety products is diverse, but overall in coming years we expect significant increases in consumption of personal protection products, alarms, CCTV, residential protection solutions, physical protection, and new electronic security devices. In fact, CCTVs and video-surveillance systems for residential, government, and industrial use are some of the most purchased goods in the security/safety sector, as well as electronic physical security products. Security solutions such as GPS and tracking systems for transport logistics will remain popular to reduce cargo theft, track assets, and aid rapid response to threats. We anticipate government purchases will continue through 2019 for body protection equipment, firearms, ammunition, CCTV, transportation and communication equipment, and a range of military equipment. Spending on consumable products will continue. The new National Guard will require a large quantity of all forms of supplies and equipment that will be purchased, at least initially, by SEDENA.
In certain applications, such as employee ID systems, we see rapid movement to integrated biometrics instead of standard physical credentials and basic smart card applications. Access control systems and surveillance cameras have been installed at many public spaces, not only in Mexico City, but also in medium-size cities. In addition, personal protection and private security services continue to expand among corporate and government end-users, with spending now reaching approximately one percent of GDP.
Safety-related equipment and services with particular potential include the following, though several of these items may be difficult for U.S. suppliers to sell at competitive prices:
Silvia I. Cárdenas
Commercial Specialist
U.S. Commercial Service—Mexico City
Tel: +52 (55) 5080-2000 ext. 5209
Silvia.Cardenas@trade.gov
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.
Overview
The safety and security market shows strong demand for products and services by government, private enterprise, and consumer buyers. For purposes of this report, ‘security’ means preventing and responding to criminal threats. By ‘safety’ we mean addressing risk of accidents, workplace protection, and natural threats.The safety and security sector includes equipment, solutions, and services used for public security, personal protection, residential security, industrial safety, corporate facilities, and infrastructure protection (access control, ID, perimeter security), as well as diverse solutions and systems designed for law enforcement and defense usage.
New technologies have entered the market in response to security trends and consumer habits. Increased demand in this sector accelerates competition among suppliers, but it is also driving more sophisticated buying decisions and interest in advanced solutions. The security market reflects the local conditions present in the country in terms of its large population at urban centers, development levels, public security policies, and strength of local and state authorities. There are many additional factors in the country’s evolving approaches to rule of law, from historic attitudes and education levels to criminal justice reform and law enforcement challenges.
The following tables provide the most recent estimates indicating approximate market size for the range of safety and security products and services in Mexico.
Mexico Safety and Security Products and Services Market Size Estimates
(Figures in USD billions)
| 2016 | 2017 | 2018 | 2019 (Estimated) | |
| Total Local Production | 2.4 | 2.4 | 2.5 | 2.5 |
| Total Exports | 3.0 | 3.1 | 3.0 | 3.0 |
| Total Imports | 1.6 | 1.7 | 1.8 | 1.8 |
| Imports from the U.S. | 0.6 | 0.7 | 0.6 | .6 |
| Total Market Size* | 1.0 | 1.0 | 1.3 | 1.4 |
| Exchange Rates | 18.68 | 18.91 | 19.22 | 19.15 |
Source: Global Trade Atlas 2018 / June
Note: The safety and security equipment and services sector encompasses several different segments, including some defense products.
Mexico is one of the most important security markets in Latin America due to its size, leading industries, development, and total demand. Moreover, security is one of the most dynamic sectors in the economy. Since 2015–2016, sales of security systems and solutions have grown, on average, about 10 percent according to domestic industry figures, far outpacing growth in the overall economy. However, in 2018 and the first half of 2019, market growth slowed as both government and private sector decisions on purchasing paused due to the Mexican federal election and awaiting implementation of planned changes by the new Mexican president, Andres Manuel López Obrador.
With an upturn in violent crime and ongoing supply chain threats in recent years in Mexico, safety and security remain a constant concern for the general public, companies, and all levels of government. Security spending is some aspect of nearly all household and organization budgets. In 2018, analysts highlighted declining security as the top factor that could limit the country’s economic development. Mexico’s National Statistics and Geographic Institute (Instituto Nacional de Estadística y Geografía or INEGI) annually prepares a National Survey of Victimization and Perception About Public Security (known as ENVIPE for its acronym in Spanish). The latest report published September 2018 shows that 64.5 percent of Mexicans consider insecurity and crime the most important problem affecting their cities.
Sales in this sector have grown across end-user segments. The 2018 national security portion of the Mexican federal budget—which includes all the principal law enforcement agencies and the Mexican Secretariat of Defense—grew to USD 7.7 billion over USD 5.6 billion in 2017. This includes plans to improve security through the creation of a new National Guard.
Private sector spending drove purchasing growth in this sector. This was due to certain factors, such as the spread of crime, limited public security resources, expanded private sector actions to protect assets, higher civic consciousness, and the widespread recognition of shared citizen and corporate responsibilities in crime prevention and education.
A major development in 2018 was the new administration’s announcement of the National Peace and Security Plan 2018-2024 (Plan Nacional de Paz y Seguridad), which includes eight specific areas of action to address Mexico’s security challenges:
- Combat corruption and restore justice systems
- Guarantee employment, education and health conditions through economic development
- Respect and promote human rights
- Re-cultivate societal ethics
- Restructure the war on drugs
- Establish a council for rebuilding domestic peace
- Restore the function and dignity of the penal system
- Implement the specific actions of the 2018-2024 plan
- Reconsider the role of the armed forces in national security
- Create the National Guard (Guardia Nacional), with the goals of preventing crime, preserving public security, and combating criminal activity
- Form 266 national, state, and regional Coordination Zones (Coordinadas) across the country by 2021
- Establish operational guidelines
During the first months of 2019, the López Obrador Administration worked with the Mexican Congress to ratify creation of the National Guard, to approve several changes to the Mexican Constitution, and to enact new laws necessary to implement the National Guard and changes in the structure of public security operations in Mexico. In addition, the Government announced the leadership of the National Guard as well as a new Secretary of Security and Citizen Protection (Secretaría de Seguridad y Protección Ciudadana or SSPC) in the Cabinet, a position now completely independent from the prior placement of this role under the National Commission of Security in the Secretariat of the Interior (Secretaría de Gobernación or SEGOB).
The National Guard itself is an entirely new body that has been authorized and budgeted to include 72,000 or more personnel by the end of 2019. To stand up the force swiftly, the Government will draw 18,000 or more units from the Federal Police, 8,000 from the Navy Military Police, and 34,000 from the Army Military Police. Some officials familiar with the longer-term plan say that the ultimate size of the National Guard is envisioned to exceed 300,000 by 2024. The Guard’s Commander is recently retired Army General Luis Rodriguez Bucio. The Guard has been authorized with strictly a civilian command, but the appointment of Gen. Rodriguez Bucio solidifies the Guard’s ties with the Mexican Army. Further, the Guard has an Operational Coordination system composed of three top chiefs from the Federal Police, the Mexican Army, and the Mexican Navy.
We noted that the Security and Peace Plan establishes 266 Coordination Zones (Coordinadas) across Mexico into which Guard units will be deployed. The Guard will commence operations in 150 of the Coordinadas in 2019. In 2020, the plan is to deploy additional units to 50 more Coordinadas (for a total of 200 deployed zones), and by 2021, Guard forces are expected in all 266 Coordinadas. As a result of a joint Mexico-U.S. declaration in June 2019, the Guard has deployed 6,000 units to Mexico’s southern border area. The Guard also has initiated a rapid deployment to the State of Jalisco.
In 2019, Mexico’s public security strategy is likely to evolve as the Guard’s deployments and other aspects of the security plan take shape, as well as any delays in budget and spending authorizations. The reform of the jail system reform and the other six areas of action already mentioned will demand attention, resources, and results. Both the public sector and private security market will continue demanding solutions to reduce security risks at different levels, particularly to contain and eventually decrease kidnapping, homicide, extortion, robbery, assault, and other high-impact crimes frequently connected with the illegal drug trade.
Leading Sub-Sectors
For purposes of this report, the security sub-sector consists of goods and services responding to criminal threats. The safety sub-sector is for goods and services addressing risk of accidents (and certain emergencies), manufacturing protection standards, and some natural threats (such as fires, floods). As in the United States, we further segment the market between government, private enterprise, and consumer end-users.
Security
The country’s security challenges and official policies influence market trends and developments. For reasons we detail below, we anticipate increased demand in several product and service categories. These include private security services, armored cars/vans, robbery prevention, CCTV, communications technologies, and cyber security solutions linked to IT applications. Mobile technologies and internet-connected devices have spread to advanced security applications, forcing organizations and individuals to replace older systems and adopt new security practices.Personal and Household Security. As noted in the overview, INEGI conducts an annual survey of public security perception (ENVIPE, for its Spanish acronym). According to the latest survey data from September 2018, it is estimated that household security spending represents 1.65 percent of the GDP, and 25.4 million people were victims of a crime. In addition, 30.1 million crimes took place in Mexico during the survey period (keeping in mind that one person can be subject to more than one crime). The main crimes were assaults and robberies in public spaces (28.1%), extortion (19.6%), fraud (13.6%), and partial and total vehicle robberies (11.4%). Moreover, when asked about the top problem in their state, 64.5 percent of respondents cite “lack of security and criminality” as the top problem, followed by inflation, unemployment, corruption, health issues, poverty, and injustice.
INEGI also compared survey responses to official crime reports and noted that only 10.4 percent of crimes were officially reported to law enforcement agencies, implying that 89.6 percent of crimes were unreported or without investigation. The INEGI survey also shows how perceptions of crime vary by state and by city. The riskier cities based on the survey are Hermosillo, Puebla, Acapulco, and Tapachula. The more dangerous Mexican states based on survey responses were Baja California, State of Mexico, State of Mexico City, Sonora, Jalisco, Tabasco, and Guerrero.
Business Security. Even though security data varies slightly depending on sources used, it is estimated that private sector companies dedicate 10–12 percent of total spending on security equipment. This spending is mainly used to enhance facility and asset protection, such as robust alarm systems, employee / contractor / visitor identification tools, CCTV systems, and high-quality perimeter protection. Other top categories are cargo theft surveillance, GPS mobile tracking systems, better logistics communications, and emergency applications. Recently, the business organization COPARMEX stated that 57.9 percent of its members have fallen victim to a security-related crime, and the organization has demanded stronger government action against crime and insecurity.
Corporate perceptions are tracked in an annual security report prepared by the American Chamber of Commerce (AmCham). It is based on a survey of more than 300 local and multinational firms based in Mexico. In the most recently published 2017-2018 survey periods, the top private sector security incidents were these six (percentages represent number of companies reporting incidents):
- Transport and supply chain attacks (42.1%)
- Virtual extortion (39.9%)*
- Theft (39.9%)
- Third party offense or threat to employees (30.3%)
- Facilities intrusion (23.7%)
- Protest, blockades, social unrest (23.2%)
Other incidents reported in the double-digits were information leaks, vandalism, and cyber-attacks. Direct extorsion reached 9.6 percent and represents a serious recurring security problem for private companies.
AmCham’s security report showed that companies were increasingly addressing external threats by adopting internal security measures using their own resources. These security measures included safety management systems; risk assessment and prevention planning; crisis management and business continuity planning; employee security awareness; improved hiring process screening; and implementation of executive protection programs. Overall, the AmCham survey respondents state their core spending is focused on risk analysis, trip protocols, physical security training, security awareness, and crisis management actions. The report underlined that today only 53.9 percent of the companies surveyed have a security department specifically for physical assets. AmCham’s 2019 Security Report will be available in late 2019.
CS Mexico monitors security developments based on issues reported by private firms and incidents reported in the news media. Among the concerns we follow have been railroad attacks to commit large-scale robbery of shipments, illegal tapping of oil and fuel pipelines, highway blockades and assaults, kidnapping, and cyber-attacks. In 2018-2019 the new administration launched an initiative to halt gas and oil theft, an illegal activity called “huachicol.”
Safety
Industrial and facility safety protection is significantly higher than household safety and generalized civil protection (i.e., more money is spent on fire suppression systems in commercial buildings than on home smoke alarms or fire department equipment). There continues to be significant evolution of new safety standards to protect lives, improve workplace environmental conditions, reduce labor risk levels, and to create an industrial safety culture. For this reason, this section focuses on business and government purchases for facility and employee safety. The U.S. Commercial Service in Mexico can assist U.S. exporters with other types of consumer safety and civil protection, and we offer market research on these sub-segments as well.Workplace Protection and Safety. Workplace safety is a major concern. The Secretariat of Labor and Social Oversight (Secretaría del Trabajo y Previsión Social or STPS)—with data from the Mexican Institute of Social Security (Instituto Mexicano de Seguridad Social or IMSS)—reported more than 270,600 work accidents and risks nationally in 2018. The industries that have recorded the most accidental deaths are transportation (driving heavy-load trucks), construction, metalworking, mining, textiles, stores and warehouses (lifting heavy weight), and delivery services (i.e., messengers riding motorcycles).
According to Mexico’s Secretariat of the Economy, Mexico has more than four million enterprises, of which micro and small firms represent 99.8 percent, and they contribute 42 percent of GDP and 78 percent of total employment. Private sector spending on safety is dominated by multinational firms, which must follow international safety standards and have resources to provide training, programs, and emergency responses. OEMs and large companies in most major are familiar with safety regulations, such as NFPA, OSHA, NEC and the United Nations Globally Harmonized System of Classification and Labelling of Chemicals (GHS/2003).
STPS requires all manufacturing plants and companies to comply with official Mexican safety standards (NOMs). STPS performs regular safety audits on these larger types of enterprises. Nevertheless, STPS does not have the resources or inspectors to perform regular safety audits on every company, nor are they able to keep the current NOMs up to date or adopt new ones from the United Nations GHS. Regularly, the STPS conducts industrial safety consultations at the national level to examine safety-related NOMs such as NOM-011-STPS-2001, NOM-015-STPS 2001, and NOM-020-STPS-2011. New international standards and more technical training for large employers have also been promoted by associations and safety experts looking to expand their services for auditing safety standards and consulting on best practices and procedures.
Consumer Safety and Micro and Small Enterprise Safety. Unfortunately, Mexico’s four million micro and small businesses generally neglect the importance of workplace safety policies, making them a less attractive target market for U.S. exporters. The same is true of general consumers. For the most part, we see these small market sub-segments purchasing low price, low quality products that are manufactured in Asia or locally. For instance, many buyers will purchase simple, small fire extinguishers rather than more extensive fire suppression systems, and cheaper fire-retardant fabrics rather than materials with higher fire protection ratings such as Kevlar.
Civil Protection. Civil protection is constrained by government budgets and policy, making this segment a less dynamic market than might otherwise be assumed. However, regular earthquakes remind authorities, organizations, and citizens about the importance of effective emergency preparedness and response plans. The most common types of accidents and natural disasters in Mexico are earthquakes, volcanic explosions, gas explosions, fires, floods, and hurricanes. Emergency and first-aid kits are part of the regular equipment acquired by many organizations to be prepared, as well as conduct of regular emergency drills.
The federal program for natural disaster response is the responsibility of the Mexican Secretariat of National Defense (Secretaría de la Defensa Nacional or SEDENA) under its Plan DNIII, so this market sub-segment is part of the overall defense budget (USD 6.1 billion in 2019). On the civilian side, firefighters, civil rescue organizations, and the Mexican Red Cross generally depend on grants and donations for equipment and assets rather than government budgets. In recent years, both the Federal Government and state authorities have reinforced civil protection units. Coordination among rescue groups and governments has improved, civil protection is attaining wider coverage, and protection plans are better known by citizens. There may be specific opportunities for U.S. exporters, but be aware that agency resources are limited with respect to expensive equipment.
There is also need for increasing expenditures on residential and corporate fire prevention. Although building construction standards imply solid safety rules, Mexico has had safety incidents due to human errors. Firefighters in Mexico received better wages in 2018 versus prior years, but in some small communities they work on a volunteer basis. The Mexican Firefighters Association estimates that there are 14,000 firefighters nationwide (2017), but only 50 percent receive a salary. In Mexico City the number of firefighters is still small for the size of the city (around 2,100 firefighters in 2017). Higher education and regular training are not common among fire crews. The federal Civil Protection Unit of SEGOB regulates firefighters and emergencies at a national level, and each state and municipality manages and budgets its own civil protection unit and local firefighters.
At the same time, Mexico is moving towards better public safety communications and warning technologies. In January 2017, Mexico completed implementation of a national 911 emergency number system. Responses to medical, security, rescue, and fire emergencies are timelier, though false reports through the 911 system are still a problem. Missing children are also reported through an “Alerta Amber” program based on the U.S. Amber Alert. Media channels broadcast the alerts, and the program has successfully located lost children. Some opportunities exist at the municipal and state levels for monitoring and emergency response technologies. For instance, Mexico City has a network of more than 15,000 video cameras in operation, and there is significant local attention across the country to command, control, and communications centers for emergency response. Some states have created command centers to improve police response times and security surveillance.
Opportunities
The U.S. Commercial Service Mexico is happy to assist you in exploring opportunities in the safety and security market here. This section highlights specific opportunities in both sub-sectors. Business opportunities are mainly in medium-sized and large urban areas, and potential suppliers should prepare an effective market entry strategy. This strategy should keep in mind local and foreign competitors, address changing consumer preferences and worries, and make available complete after-sales service. In general terms, U.S. security products have a good market reputation, and end-users are familiar with U.S. brands and market trends, but other large foreign firms provide stiff competition. Potential suppliers should become familiar with Mexico’s geographic markets by visiting and attending commercial events around the country. After-market service and system warranties can make a difference in gaining advantage over other suppliers. Suppliers should also consider how mobile security applications are impacting buying habits and modifying end-user expectations and demand.The scope of security and safety products is diverse, but overall in coming years we expect significant increases in consumption of personal protection products, alarms, CCTV, residential protection solutions, physical protection, and new electronic security devices. In fact, CCTVs and video-surveillance systems for residential, government, and industrial use are some of the most purchased goods in the security/safety sector, as well as electronic physical security products. Security solutions such as GPS and tracking systems for transport logistics will remain popular to reduce cargo theft, track assets, and aid rapid response to threats. We anticipate government purchases will continue through 2019 for body protection equipment, firearms, ammunition, CCTV, transportation and communication equipment, and a range of military equipment. Spending on consumable products will continue. The new National Guard will require a large quantity of all forms of supplies and equipment that will be purchased, at least initially, by SEDENA.
In certain applications, such as employee ID systems, we see rapid movement to integrated biometrics instead of standard physical credentials and basic smart card applications. Access control systems and surveillance cameras have been installed at many public spaces, not only in Mexico City, but also in medium-size cities. In addition, personal protection and private security services continue to expand among corporate and government end-users, with spending now reaching approximately one percent of GDP.
Security
Security solutions with business potential include:- CCTV
- Access control solutions
- Alarms (residential, industrial, buildings)
- Perimeter protection and surveillance
- Fire systems
- Smart homes and buildings
- Cybersecurity
- UAVs and drones
- Communications systems (wireless, internet, GPS, etc.)
- Integrated security solutions (compatibility/integration services)
- High-tech night vision tactical equipment
- Tactical equipment
- Communications integration services
Safety
Safety-related equipment and services with particular potential include the following, though several of these items may be difficult for U.S. suppliers to sell at competitive prices:
- Emergency response training
- Protective gloves, suits, and footwear
- Eye and ear protection
- Breathing protection equipment for gas and fine dust
- Protective gear for welding activities
- Equipment and gear to protect against falling objects and electrical hazards
- Smoke detectors, fire alarms, and fire suppression systems
- Certified inspection services and testing equipment (NOMs compliance)
Web Resources
| National Institute of Statistics and Geography (INEGI) | www.inegi.org.mx |
| Secretariat of Interior (SEGOB) | www.segob.gob.mx |
| AmCham Mexico | www.amcham.org.mx |
| National Citizen Observatory (ONC) | onc.org.mx |
| Mexico United Against Crime (Mexico Unido Contra la Delincuencia) | www.muccd.org.mx |
| American Association for Industry Security (ASIS) Mexico Chapter | www.asis.org.mx |
| Latin America Security Association (ALAS) Mexico Chapter | www.alas.org.mx |
| National Council of Private Security, A.C. (CNSP) | www.cnsp.org.mx |
| International Institute for Risk Management (IIAR) | www.seguridadindustrial.com.mx |
| Federal Civil Protection Secretariat | www.gob.mx/proteccioncivil |
Events
- Expo Seguridad Mexico (ESM) 2020 (including a U.S. Pavilion, Expo Seguridad Industrial, and NFPA Fire Expo), April 21–23, 2020, Centro Citibanamex, Mexico City
- Constructo 2019 Safety Pavilion, August 21–22, 2019, CINTERMEX, Monterrey, Nuevo León
Contacts
For more information on the security and safety sectors in Mexico, please contact:Silvia I. Cárdenas
Commercial Specialist
U.S. Commercial Service—Mexico City
Tel: +52 (55) 5080-2000 ext. 5209
Silvia.Cardenas@trade.gov
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.