By Vic Kolenc / El Paso Times
Rudy GutierrezÑEl Paso Times Bob Wells, left, president of DMP CryoSystems at 2010 Bassett Ave. stands by a heat-freeze chamber under construction in background Thursday.
El Paso ranks as the 26th largest exporter among the nation’s metro areas, new data show.
El Paso companies exported $12.8 billion last year to Mexico, Canada, China, and a list of other countries, show data released last month by the U.S. Commerce Department’s International Trade Administration.
That’s more exports than from all of New Mexico – $3 billion last year, with a big chunk of that from Santa Teresa, an El Paso bedroom community, the data show. The Las Cruces area, which mostly includes Santa Teresa, had $746 million in exports last year, the data show.
El Paso County exports grew $1.2 billion last year, and have been growing steadily since 2010.
“We think of (many) other cities as bigger and more powerful than El Paso, but when it comes to export numbers, El Paso outranks other powerful cities in the United States,” said Robert Queen, director of the Commerce Department’s Export Assistance Center in El Paso.
Austin, Memphis, Phoenix, and a host of other cities are below El Paso on the list for metro area exports.
El Paso is the fourth-largest exporter to Mexico among U.S. metro areas, Queen noted. Last year, El Paso companies exported $10.1 billion to Mexico. Detroit was first with $20.2 billion in exports to Mexico.
The exports from El Paso companies are just a piece of this area’s multibillion trade industry. Last year, more than $88 billion worth of exports and imports went into and out of Mexico through El Paso County and Santa Teresa international ports of entry, including railroad crossings, show data compiled by the Texas Center for Border Economic and Enterprise Development at Texas A&M International University in Laredo.
All the trade generates important economic activity in the El Paso area, noted Baldo Garcia, program manager for the Laredo center. But exports actually produced in El Paso have a larger multiplier effect in the local economy, he said.
Not all of the $12.8 billion in exports are products made here; some also are products and materials from other areas being processed in warehouses and other facilities. But the exports carry a powerful economic punch, Queen said.
The International Trade Administration estimated that every $1 billion in U.S. exports support 4,926 jobs nationally. That means thousands of El Paso jobs are tied to El Paso’s export market.
Keats Southwest, an East El Paso metal-stamping plant spun off of Keats’ Chicago factory, opened here 19 years ago to be close to its Mexico customers, said Matt Keats, president of the El Paso company. It employs 50 people and has annual revenues of about $10 million, he said.
“We wouldn’t be located here if we had no exports to Mexico,” Keats said. “I guess we produce about 100 million parts per year,” and most of those go to assembly plants in Mexico, he said.
For example, it ships 150,000 to 200,000 visor clips for garage-door remote controls each week to a manufacturer in Nogales, Mexico, Keats said.
DMP CryoSystems, which operates a small factory in Central El Paso, doesn’t have Keats’ volume, but the export market is still important for it, said Bob Wells, president and co-founder of the 18-year-old company. It custom builds machines with a furnace and freezer, which are used for heat and freezing treatments used in making gears, bearings, engine blocks, knife blades and other products.
The factory, which employs seven people, sells eight to 10 machines a year for prices ranging from $30,000 to $250,000 Wells said.
It’s exported machines to Europe and Asia. Mexico is not a big market for the company because the cost of nitrogen needed for the machines is costly there, he said.
“Last year, we sent two (machines) out of the country,” which was 20 percent of the company’s sales, Wells said. “It’s a welcome 20 percent,” Wells said, and a number the company wants to grow.
“The numbers are not staggering. But if we’re able to deliver (more machines) to the export market, it likely will keep foreign manufacturers from copying our equipment,” Wells said. The company possibly could lose sales not only in other parts of the world, but also in the United States because foreign companies would likely sell the machines here also, he said.
DMP CryoSystems’ exports are likely classified as El Paso exports because the machines are sent out of the El Paso factory to foreign customers. But sometimes, that doesn’t happen. For example, it’s not clear that all of Keats Southwest’s products are counted in El Paso’s export totals because many of the factory’s components are shipped to warehouses on the U.S. side of the border, and handled by a logistics company for Keats’ customers. It’s possible some of the components get counted as exports out of the warehouse where they are shipped, said Queen, of the El Paso Export Assistance Center.
Whoever fills out the export documents is usually who gets credited as the exporter, Queen said. For example, New Orleans has huge amounts of wheat exports, and the Louisiana companies become the exporters even though the wheat is produced in the Midwest, he noted.
Export numbers for an area could be overstated or understated, Queen said. But in the end, the numbers usually come close to representing an area’s export market, he said.
Trans-Expedite, an El Paso shipping and logistics company, gets credited as the exporter for many products made elsewhere, and shipped out of its warehouse to Mexico or other countries.
“Exporting is a big part of our growth,” said Keeli Jernigan, Trans-Expedite chief executive officer and co-founder. The company is exporting materials and products to Mexico, Canada, and other countries, she said.
Trans-Expedite employs 195 people in eight cities, including 100 in El Paso where it’s headquartered. It has annual revenues of $50 million, and growing.
“This region is really growing,” and the export market, especially to Mexico, is a big part of that growth, Jernigan said. “It’s a great position to be in.”
Vic Kolenc may be reached at 915-546-6421.