Nearshoring is the relocation of manufacturing operations from distant regions (mainly Asia) to countries close to the main consumer market. In Mexico, this trend has been driven by USMCA, the search for supply-chain resilience after the pandemic, and US–China trade tensions. In Q1 2026, Mexico consolidates its position as the preferred nearshoring destination in North America. FDI reached a record of roughly USD 41 billion in the first three quarters of 2025; for 2026, projections put FDI between USD 40 and 45 billion, with manufacturing accounting for 37% of the total.

What valuation multiples matter for manufacturing?

Valuation multiples allow standardized comparison of companies and deals. For Mexican manufacturing and SME M&A, the most relevant are:

• EV/EBITDA: Enterprise value relative to operating earnings. The most used multiple in manufacturing M&A because it normalizes capital structures and tax regimes.
• P/E (Price/Earnings): Reflects growth expectations. Useful for comparing listed companies in the sector.
• EV/Sales: Indicates revenue scalability. Relevant for early-stage companies or those with margins expanding from nearshoring.

How have multiples varied by sector in Q1 2026?

Valuation multiples are compared between Q1 2025 and Q1 2026 for the main manufacturing subsectors benefiting from nearshoring. Data integrates public sources (INEGI, Banxico, Kroll, Damodaran) and estimates based on FDI trends in the second half of 2025.

How has EV/EBITDA in manufacturing evolved between 2024 and 2026?

What factors drive these changes?

• Labor cost advantage

  Average manufacturing labor cost in Mexico remains 40–60% below the US equivalent, improving EBITDA margins and thus multiples.

• Shorter logistics lead times

  Proximity cuts delivery times from 45–60 days (Asia) to 3–7 days, attracting FDI that pushes multiples up in northern industrial zones.

• Industrial policy (IMMEX and Nearshoring Decree)

  Tax incentives and faster permits for strategic sectors —semiconductors, electric vehicles, and renewable energy— have improved expected profitability for benefiting companies.

• Inflation and exchange rate

  Inflation around 4% and a relatively stable peso against the dollar have reduced country risk premium, supporting multiples.

Where is nearshoring concentrated by region?

Northern states —Nuevo León, Chihuahua, Coahuila, Baja California— and the Bajío corridor (Guanajuato, Querétaro, Jalisco) concentrate the highest multiples premia. Guadalajara has seen valuation increases of up to 25% for electronics companies versus the prior year, driven by investments such as Foxconn’s AI server plant (USD 690 million) in partnership with Nvidia.

What could compress multiples?

Four dynamics could reverse part of the current expansion:

• Unfavorable USMCA review: Changes in rules of origin or tariffs that reduce preferential access to the North American market.
• Banxico rate hikes: Monetary tightening would raise cost of capital and compress multiples.
• Peso volatility: Sustained depreciation increases country risk premium.
• Industrial policy changes: Cuts or changes to IMMEX or Nearshoring Decree incentives.

What is at stake with the 2026 USMCA review?

The USMCA review scheduled for 2026 evaluates rules of origin, regional content, and labor provisions. A favorable outcome —maintaining or expanding preferential access— would consolidate current multiples premia. An unfavorable outcome —additional tariffs or restrictions— would compress valuations in export-oriented sectors. The first phase of conclusions is expected by mid-2026.

What do these changes mean for SMEs and M&A?

The sustained rise in manufacturing multiples has direct implications for owners of Mexican manufacturing SMEs and for M&A professionals and investors.

How to prepare to capture the multiple (sellers)?

Sellers aiming to benefit from current premia should:

1. Prepare normalized EBITDA with documentation.
2. Document contracts with foreign customers.
3. Review concentration metrics (customers, suppliers).
4. Structure costs and margins in an explainable way.

See How to prepare your company for a transaction for a detailed checklist.

How is FDI distributed by manufacturing sector in Q1 2026?

Estimated composition: Automotive 38%, Electronics 22%, Aerospace 14%, Chemicals 12%, Maquiladoras 9%, Textile 5%. Automotive concentration reflects Japanese auto-parts expansions (USD 18 billion committed) and the effect of gigafactories.

What is the outlook for Q2 2026?

For the second quarter, three dynamics stand out: (1) the conclusion of the first phase of the USMCA review, which if favorable would consolidate current multiples premia; (2) the start of operations of new plants in Nuevo León and Jalisco, adding productive capacity and tending to push maquiladora multiples up; and (3) a cut in Banxico’s reference rates, which would lower cost of capital and support valuations. The base case assumes average manufacturing EV/EBITDA between 9.5x and 10.5x by June 2026.

What regulatory perspective affects M&A in Mexico?

Two regulatory pillars can affect closing and timeline of an M&A transaction in Mexico: COFECE (concentrations and competition) and the Foreign Investment Law (LIE) with the CNIE. Participants in manufacturing or cross-border deals should consider from the LOI whether antitrust notification or foreign-investment approval applies. Detail in the Regulation and M&A in Mexico guide.

Where regulatory steps sit in the process

1. LOI — set governing law and currency.
2. Due diligence — verify whether COFECE notification or CNIE approval applies by sector and buyer.
3. Notification or filing — submit to COFECE or CNIE as applicable.
4. Waiting period — build into closing timeline.
5. Closing — only once agreed regulatory conditions are met.

What key terms are used in this analysis?

Nearshoring

Relocation of manufacturing operations close to the main market, e.g. from China to Mexico.

EV/EBITDA

Enterprise value over operating earnings. Standard multiple in manufacturing M&A.

FDI

Foreign Direct Investment. Foreign capital for productive operations in Mexico.

USMCA

Agreement between Mexico, the US, and Canada. Framework for preferential access to the North American market.

IMMEX

Program allowing temporary import of inputs duty-free for export manufacturing.