Auto Parts Manufacturing and Assembly
Emilio Márquez
emarquez@investlbdev.consiti.com
Mobile: +503 7071 7029
Boost your auto parts production with a nearshoring platform that provides tax incentives, government support, and export experience.
El Salvador represents a unique opportunity for auto parts manufacturing and exporting companies, especially in the context of nearshoring, by facilitating the manufacturing of intermediate components (Tier II and Tier III) that strategically supply the US and Mexican markets.
We offer competitive tax incentives, strong government support, and a proven track record in exporting auto parts for leading automotive brands. Its future advanced technological infrastructure and transforming industrial environment position it as an ideal strategic partner.
With the potential to supply strategic markets, El Salvador is the gateway for your company’s growth and expansion in the region.
Total auto parts exports, 2023
Export of spark plug wiring harnesses, 2023
Of auto parts exports destined for North America in 2023
EI Salvador has a good base of technicians and professionals willing to join the country’s productive sectors.
ELECTRICAL AND ELECTRONIC COMPONENTS FOR THE AUTOMOTIVE INDUSTRY
With the move towards increasingly connected and intelligent vehicles, these components represent a growing market. El Salvador already has a solid base in this sub-sector, supported by producers and exporters of electronic harnesses and capacitors.
- Sensors
- Control modules
- Electrical connectors
- Electrical harnesses
- Advanced electronic components
PLASTIC COMPONENTS
El Salvador has a well-established plastics industry, and the production of molded plastic auto parts is a natural step, taking advantage of the sector’s capacity and experience.
- Door panels
- Bumpers
- Dashboard components
- Electronic system housings
- Engine covers
- Cable insulation
- Knobs
- Plug connectors
TEXTILE PARTS FOR AUTOMOTIVE INTERIORS
El Salvador’s strong textile industry can diversify into the production of automotive interior components.
- Components Airbags
- Seat belts
- Upholstery
- Coatings
- Colour insulation
METAL-MECHANICAL COMPONENTS
Given the metal-mechanic industrial base in El Salvador, there is the potential to produce these automotive parts and supply the US and Mexican markets.
- Stamped metal parts
- Chassis supports
- Suspension components
- Gears and transmission parts
investing in
El Salvador
- Strategic location for nearshoring, facilitating integration into the automotive and auto parts value chains in North America, with access to both U.S. coasts in less than 6 hours.
- The safest country in the Western Hemisphere in 2024, with a dollarized economy offering stability and certainty for investors seeking profitable opportunities.
- Utilization of productive capabilities in the auto parts and automotive sector, leveraging installed infrastructure and concentrated expertise in industries such as electronics, electrical, textiles, and plastics.
- Advanced technological platform, featuring the construction of a submarine cable, deployment of 5G, and collaboration with Google to accelerate digital transformation, boosting automation and optimization of industrial processes.
- Modernized and digitized customs, with an integrated customs system facilitating regional trade and commerce with the United States, supported by an agreement with the U.S. Customs and Border Protection.
- Implementation of tailored skill development programs for companies and government incentives for hiring in strategic sectors in El Salvador.
- The most attractive free zone regime in Latin America, offering up to 45 years of tax exemptions and accessible requirements for investment.
- Tax incentives for renewable energy generation projects, enabling more economical and sustainable production supported by one of the most diversified energy matrices in Latin America and the Caribbean.
- Legal and tax stability, with a stable political environment and the option of legal stability contracts for up to 20 years with investments exceeding USD 15.4 million in fixed assets.
- Exemption from customs duties and other taxes on the importation of machinery and equipment necessary for exportable production during the period in which they carry out their operations.
- Exemption from customs duties and other taxes on the import of raw materials and other equipment necessary for the execution of the incentivized activity during the period in which they carry out their operations.
- Exemption from customs duties and other taxes on lubricants, fuels and other substances necessary for the productive activity during the period in which they carry out their operations.
- Total exemption from Real Estate Transfer Tax for the acquisition of real estate to be used in the promoted activity.
- Exemption from Income Tax in accordance with the following detail:
- Leading Japanese company worldwide in automotive cable and harness systems.
- Started operations in the department of Santa Ana in 2006.
- Current employment: More than 1,200.
Production: 300 to 400 harnesses per day. - Turnover: 0.48% per year.
- Operational efficiency: 80%, exceeding the standards of other YAZAKI plants worldwide.
- Brands manufactured in El Salvador: Subaru (harnesses), Jeep (chassis harnesses), and Chrysler (door harnesses).
- More than 37 years operating in El Salvador.
- Manufactures ceramic and tantalum electronic capacitors that meet international standards.
- AVX Kyocera went from assembly to chemical processes, molding, testing and packaging. The implementation of the new production lines took 10 months, compared to two years in other countries.
- Its operations in the country have a high production efficiency, which amounts to 97%.
If you wish to invest in another sector, you can also seek advice from our specialists.