Toymaker Mattel Expands Mexican Plant In 'Nearhsoring' Scheme

Mattel Inc. top-selling toys like Mega Bloks will now be made in Mexico, as the US toymaker becomes the latest company to move its supply chain closer to home, a shift called “nearshoring,” Kylie Madry reported for Reuters.

Photo Insert: Mega Bloks. Soon to be made in Mexico

Mattel announced in mid-March it had spent around a billion pesos, or $50 million, to expand a plant in the northern Mexican state of Nuevo Leon, which is now the company's largest plant, overtaking other hubs in China, Vietnam, and Malaysia.

The plant in Monterrey, close to the US border, sprawls across 200,000 square meters (2.25 million square feet), employing close to 3,500 workers.

"Being able to have product close to your consumer and not having to transport it from Asia, that's going to be more profitable and more competitive when you take costs into account," Mattel's Latin America managing director, Gabriel Galvan, told Reuters.

The expansion was first pitched in 2020, Galvan said. Mattel closed two factories in Asia in 2019 and more recently shuttered a plant in Canada and another in Mexico ahead of the expansion of the mega-factory.

"This consolidation and plant expansion was in line with the company's transformation/turnaround strategy and a manufacturing footprint consolidation we called 'Capital Light,'" spokeswoman Catherine Frymark told Reuters in an email, saying that the strategy was four years in the making.

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