Mexico’s automotive manufacturing boom strains suppliers, supply of workers

BMW has begun training Mexican workers as it builds a plant in San Luis Potosi. Ford plans to build a plant there, and General Motors has operations nearby.
BMW has begun training Mexican workers as it builds a plant in San Luis Potosi. Ford plans to build a plant there, and General Motors has operations nearby.

By Laurence Iliff / Automotive News

Oscar Albin pores over a slide presentation showing Mexico’s key advantages for the automotive supply sector. As executive president of the National Auto Parts Manufacturing Association, Albin is particularly proud of a few of them.

For starters, there are the manufacturing costs, which not only run 10 percent below costs in the U.S. but are below even China’s, according to the slide presentation, which cites sources ranging from government agencies and international consulting firms to the auto-parts group’s own data.

Then there are the free-trade agreements: 14 of them, covering 46 countries, said Albin, a mechanical engineer who spent 23 years at Chrysler de Mexico.

“We are at the center of the world,” said Albin, pointing to a graphic showing Mexico’s access to North America, South America, Europe and Asia. About 90 percent of the top 100 global suppliers have a local presence.

But life is not all wine and roses for the roughly 600 Tier 1 suppliers in Mexico that feed local plants and export to the U.S., among other nations.

Mexico’s fast growth as an export platform for light vehicles and strong demand for components worldwide is causing a shortage of qualified labor, Albin said, and it has quickly become the industry’s biggest challenge.

http://www.autonews.com/article/20160905/OEM10/309059954/mexicos-boom-strains-suppliers

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