Mexico - Country Commercial Guide
Safety and Security

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2020-08-18

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 Mexico's large urban populations, 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)

 

2017

2018

2019

2020 (Estimated)

Total Local Production

2.4

2.5

2.0

1.5

Total Exports

3.1

2.8.

2.2

1.6

Total Imports

1.7

1.6

1.1

1.6

Imports from the U.S.

0.7

0.6

0.5

0.9

Total Market Size*

1.0

1.3

.9

1,5

Exchange Rates

18.91

19.22

19.26

20.0

*Total market size = (total local production + imports) - exports
Source: Global Trade Atlas 2020
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, sales of security systems and solutions have grown, on average, about 13 percent according to domestic industry figures, far outpacing growth in the overall economy. However, in 2019, market growth slowed mainly because federal austerity programs and redirecting budgets to social programs. The private sector is now cautious with purchases and projects given the numerous changes implemented by Mexican President Andres Manuel López Obrador.

With an uptick 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 and 2019, 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 2019 shows that 33.9 per cent of homes had at least one victim of crime. At the individual level, 24.7 million people suffered a crime, just above the 2016 level though lower than in 2017. ENVIPE also reflected that the most dangerous Mexican states were Mexico City, State of Mexico, Baja California, Sonora, and Tabasco.

Sales in this sector have grown across end-user segments. The 2020 national security and defense portion of the Mexican federal budget—which includes the principal law enforcement agencies and the Mexican military (Army, Air Force, and Navy)—grew to USD 9.6 billion this year versus USD 7.7 billion in 2018. This includes funds for expanding the new National Guard, and infrastructure projects led by the military.

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 2019 was the Administration’s execution 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
  • 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

This plan has five main elements:

  • 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 (Coordinaciones Regionales) across the country by 2021
  • Establish operational guidelines

The López Obrador Administration has the National Guard taking on law enforcement functions as a civilian force. Today it is composed of about 100,000 officers and has been deployed to 176 coordination zones throughout the country,

During 2019, the López Obrador Administration worked with the Mexican Congress to pass legislation creating the National Guard, including corresponding changes to the Mexican Constitution, and to enact secondary legislation on use of force and changes in the structure of public security operations in Mexico. 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, though this estimate seems unlikely and more realistically would be well under 200,000. The Guard’s Commander is the retired Army General Luis Rodríguez Bucio. The Guard falls under the Secretariat of Security and Citizen Protection (SSPC) and General Bucio reports to the president through the civilian SSPC secretary, but General Bucio also coordinates closely with the Mexican Army. Further, the Guard has an Operational Coordination system composed of three top chiefs from the SSPC, the Mexican Army, and the Mexican Navy.

We noted that the Peace and Security Plan establishes 266 Coordination Zones across Mexico into which Guard units will be deployed. In 2020, the plan is to deploy additional units to 50 Coordinaciones, on top of the 150 assigned in 2019 (for a total of 200 deployed zones). By 2021, Guard forces are expected in all 266 Coordinaciones. 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, as well as to some cities with serious security risks.

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 organized crime. In the first months of 2020, other security threats have surged such as some assaults in supermarkets and at luxury shops, as well as sea attacks on oil platforms in the Bay of Campeche. Reports of common crimes like robbery dipped slightly during COVID-19 pandemic, but domestic violence and homicides – particularly against women – increased. National Guard units deployed in main cities to bolster state and local police forces grappling with enforcing COVID-19 restrictions while protecting their own officers.

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), industrial protection standards, and natural threats such as fires and floods. As in the United States, we further segment the market between government, private enterprise, and consumer end-users.

Security

We anticipate  a steady 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).  Household security spending represents an estimated 1.65 percent of GDP. ENVIPE 2019 reported that 24.7 million people were victims of 33 million crimes 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 (28.5%), extortion (17.3%), fraud (14.3%), and partial and total vehicle robberies (11.5%). Domestic violence and femicide are also serious and growing concerns.

INEGI also compared survey responses to official crime reports and noted that only 10.6 percent of crimes were officially reported to law enforcement agencies, implying that 89.4 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, Valle de Mexico, Puebla, Toluca, San Luis Potosi, and Villahermosa.

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. In January 2020, the business organization COPARMEX outlined the impact of Mexico's significant surge in violence, with daily averages of 95 individuals killed, four reported kidnappings, and 150 small businesses assaulted. Sixty-five percent of its members have fallen victim to a security-related crime.

Corporate perceptions are tracked in a 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):

  1. Transport and supply chain attacks (42.1%)
  2. Virtual extortion (39.9%)*
  3. Theft (39.9%)
  4. Third party offense or threat to employees (30.3%)
  5. Facilities intrusion (23.7%)
  6. Protest, blockades, social unrest (23.2%)

*Virtual extortion is a type of telephone-based extortion.

Other incidents reported in the double-digits were information leaks, vandalism, and cyber-attacks. Direct extortion 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. Most of the companies have established a chief security officer to prevent and resolve security threats.

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.Attacks on sea-based oil platforms attacks are also growing.

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 200,700  work accidents and risks nationally in 2019, representing an improvement of 50 percent over 2018 (398,140). The industries that have recorded the most accidental deaths are commodity and related activities (mining, agriculture, livestock); industrial machinery operators including transportation (driving heavy-load trucks); wholesale activities; and sales, professional, and technical activities,

According to Mexico’s Secretariat of the Economy (2018), 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 are generally 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. .

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. With the COVID-19 emergency, the Secretariat of Health (Secretaría de Salud or SS) has been the leading federal agency to coordinate government planning. However, the national emergency defense plan known as DN-III, gives overall control for managing facilities, supply logistics, and planning to the Secretariat of National Defense (Secretaría de la Defensa Nacional or SEDENA) and Secretariat of the Navy (SEMAR), similar to the role the U.S. Federal Emergency Management Agency (FEMS) plays in the United States.

In fact, the federal program for all disasters including natural disaster response falls under SEDENA Plan DN-III, so this market sub-segment is part of the overall defense budget (USD 4.8 billion in 2020 only for SEDENA). 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 fire safety rules, Mexico has had fire-related incidents due to human errors. Firefighters in Mexico received better wages in 2019 versus prior years, but in some small communities they work on a volunteer basis. The Mexican Firefighters Association estimates that there are 14,250 firefighters nationwide (2019), but only 45 percent receive a salary. In Mexico City the number of firefighters is still small for the size of the city (around 1,900 firefighters in 2019). 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. Last year, the Mexican Firefighters Association urged allocation of dedicated state and municipal firefighting budgets. More than 60 per cent of the 490 firefighters groups are civil associations formed by local communities without official support.

At the same time, Mexico is moving towards better public safety communications and warning technologies. In 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 Mexico City C5 continues expanding its security cameras coverage. In very high crime areas, it has installed more security towers with panic buttons under the program Mi Calle. Another similar program for small businesses is called Mi Negocio.

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. U.S. security products generally 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.

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, commercial, 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 2020 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 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
  • Police 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)/National System of Civil Protecton

www.segob.gob.mx

Secretariat of Public Security and Citizen Protection (SSPC)

www.gob.mx/sspc

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 13- 15, 2021, Centro Citibanamex, Mexico City
  • Constructo  Safety Pavilion, March 24-26, 2021, 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