Skip to main content
Disciplines
Automotive Business IT + Informatics Construction + Real Estate Electrical Engineering + Electronics Energy + Sustainability Insurance + Risk Finance + Banking Management + Leadership Marketing + Sales Mechanical Engineering + Materials
Events
DE
EN
Books
Journals
Topic Page
Marketing
Start single access now
Access for companies
EXTENDED SEARCH
Log in
Top
Published in:
Introduction: Changing Geographies and Frontiers of the Automotive Industry Read chapter Read first chapter

2020 | OriginalPaper | Chapter

13. The Boom of the Mexican Automotive Industry: From NAFTA to USMCA

Author : Alex Covarrubias V.

Published in: New Frontiers of the Automobile Industry

Publisher: Springer International Publishing

Log in

Activate our intelligent search to find suitable subject content or patents.

search-config
loading …

Abstract

After half a century of attracting foreign direct investment (FDI) flows and becoming one of the three hotspots in the global automotive industry, Mexico has been unable to advance in upgrading and catching-up, other than in processes—not in terms of products and even less so in design. Furthermore, it does not have its own industry and largely depends on cheap labor to preserve its competitiveness. In comparison with the Asian entrepreneurial state, what we have referred to as the Mexican syndrome, represents the unintentional effects of being inundated by global value chains (GVCs) and FDI flows.

Dont have a licence yet? Then find out more about our products and how to get one now:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

  • über 102.000 Bücher
  • über 537 Zeitschriften

aus folgenden Fachgebieten:

  • Automobil + Motoren
  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Elektrotechnik + Elektronik
  • Energie + Nachhaltigkeit
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Maschinenbau + Werkstoffe
  • Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

inform now

Springer Professional "Technik"

Online-Abonnement

Mit Springer Professional "Technik" erhalten Sie Zugriff auf:

  • über 67.000 Bücher
  • über 390 Zeitschriften

aus folgenden Fachgebieten:

  • Automobil + Motoren
  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Elektrotechnik + Elektronik
  • Energie + Nachhaltigkeit
  • Maschinenbau + Werkstoffe




 

Jetzt Wissensvorsprung sichern!

inform now

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

  • über 67.000 Bücher
  • über 340 Zeitschriften

aus folgenden Fachgebieten:

  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Versicherung + Risiko




Jetzt Wissensvorsprung sichern!

inform now
previous chapter The Indian Automobile Industry: Technology Enablers Preparing for the Future
next chapter The New Geography of the Automobile Industry: Trends and Challenges in Brazil
Footnotes
1
The USMCA must still be ratified by the legislative branches of the three countries, which is expected to take place during 2019.
 
2
Unless otherwise indicated, Mexico’s auto industry data cited here are from INEGI (Instituto Nacional de Estadistica Geografía e Informatica), ProMexico, AMIA (Asociación Mexicana de la Industria Automotriz), and OICA (International Organization of Motor Vehicle Manufacturers).
 
3
From 2007 to 2017 Mexicoauto output grew 1.9 times (from 2.1 to 4 million units per year), China’s 3.2 times (from 8.9 to 29 million units for a 225% total increase), and India’s 2.2 times (from 2.2 to 4.8 million units annually for a 118% overall increase).
 
4
Data up to December 2017 according to INEGI-EMIM (2018). Considering indirect jobs associated to the MAI, the estimations amount to 2 million jobs.
 
5
In the eighties started a “new era” of the MAI (Carrillo V. 1990) featured by trade liberalization and export-oriented policies. The auto industry’s decrees of 1983 and 1989 emphasized these features. Yet there were still restrictions on local content, native ownership and trade barriers that NAFTA would come to eliminate immediately (approximately 50% of them) or gradually, in a ten-year period.
 
6
It belongs to the Daimler-Nissan alliance to assemble Mercedes-Benz and Infiniti models.
 
7
Forbes 2018 ranking places him at sixth.
 
8
They are GM, Nissan, Honda, BMW, Mazda, Daimler AG, VW and Toyota.
 
9
The MAI goes back to the 1920s and 1930s when Ford, GM and Chrysler set up the first automotive facilities in Mexico. Yet they mostly assembled completely knocked down units. The decade of the 60s is identified as the full starting point of the MAI, when the D3, Nissan and VW built assembly plants in Central Mexico and Puebla following Mexican government’ import substitutions policies to spur domestic production. A second phase or wave of the MAI started in the eighties, when the industry was reoriented to external markets. NAFTA brought about the third wave and the boom of the MAI came to represent a fourth stage.
 
10
NOM-163-SEMARNAT-ENER-SCFI-2013. CO2 emissions cast by the exhaust and its equivalence in terms of fuel encompassing new vehicles up to 3857 Kg.
 
11
I estimate this 30% based on the specifics contained in the same collective bargaining agreements. The Conference Board estimates at 29.7% of total compensation the cost for benefits in the whole Mexican manufacturing sector.
 
12
Other location-sensitive cost factors range as follows: Cost of capital, 11–25%; taxes, 10–18%; transportation, 6–21%; utilities, 2–7%; and facilities, 2–5% (KPMG 2016).
 
13
It states that, for the agreement not to be delayed, Mexico shall adopt such legislation before January 1, 2019.
 
Literature
Bensusán, Graciela, and Alex Covarrubias V., 2016), “Relaciones laborales y salariales en la IAM: ¿vendrá el cambio de fuera?.” Covarrubias V., Alex, Graciela Bensusán, Arnulfo Arteaga, and Sergio Sandoval, editores. La Industria Automotriz en México: Relaciones de empleo, culturas organizacionales y factores psicosociales. Mexico: Colson-CIAD y AM Editores.
Bensusán, Graciela, and Kevin Middlebrook. 2013. Sindicatos y Política en México: Cambios, Continuidades y Contradicciones. UAM-Clacso-Flacso.
Bouzas Ortiz, José Alfonso, and Aleida Hernández Cervantes. 2008. Contratación colectiva de protección en México, Informe a la Organización Regional Interamericana de Trabajadores (ORIT). 2a reimp. México: Fundación Friedrich Ebert.
Caraway, Teri, M.L. Cook, and S. Crowley. 2015. Working Through The Past: Labor and Authoritarian Legacies in Comparative Perspective. Cornell, ILR Press.
Carrillo V., Jorge. 1990. La Nueva era de la industria automotriz en México: Cambio tecnológico, organizacional y en las estructuras de control. COLEF.
———. 2016. Oportunidades y retos en la inserción en cadenas de valor global La industria automotriz y aeroespacial en México. TECHIT 352.
Center for Automotive Research (CAR). 2016. The Growing Role of Mexico in the North American Automotive Industry. Trends, Drives and Forecasts. Ann Arbor, MI.
———. 2018. NAFTA Briefing. Review of Current NAFTA Proposals and Potential Impacts on the North American Automotive Industry. Ann Arbor, MI.
Compa, Lance, and Tequila Brooks. 2015. NAFTA and the NAALC: Twenty Years of Trade-Labour Linkage in the Americas. Wolters Kluwer Publishers.
Cook, Maria L. 2007. National Labor Strategies in Changing Environments: Perspectives from México. Center for Labor Research and Studies/Florida International University.
Covarrubias V., Alex. 2017. La geografía del auto en México. Cual rol de las instituciones locales? Revista de Estudios Sociales 27 (49): 211–241.
De Buen Unna, Carlos. 2011. Los Contratos Colectivos de Proteccion Patronal en Mexico. México: Friedrich-Ebert-Stiftung (FES).
Hufbauer, Gary Clyde, and Jeffrey J. Schott. 2005. NAFTA Revisited—Achievements and Challenges. Washington, DC: Peterson Institute for International Economics.
Klier, Thomas, and J. Rubenstein. 2017 Mexico’s Growing Role in the Auto Industry under NAFTA: What Makes What and Goes Where. Economic Perspectives. Federal Reserve Bank of Chicago.
Leibestein, H. 1957. The Theory of Underemployment in Backward Economies. Journal of Political Economy LXV (2): 91–103.CrossRef
Office of the United States Trade Representative. 2017. Summary of Objectives for the NAFTA Renegotiation, July 17. Executive Office of the President.
Pries, Ludger. 2000. Entre el corporativismo productivista y la participación de los trabajadores. Globalización y Relaciones Industriales en la Industria Automotriz Mexicana. Mexico: MA Porrua.
Rodriguez A., Mauricio, and P. Landy Sanchez. 2017. El Futuro del Trabajo Automotriz en Mexico. El Colegio de Mexico. Apuntes Para la Equidad No 1. Seminario sobre Trabajo y Desigualdades, ed. Landy Sanchez P. El Colegio de Mexico.
SE (Secretaria de Economia). 2017. Mexico’s Auto Industry, 23 Years since NAFTA and Beyond. Gobierno de la Republica, Mexico.
Stanford, Jim. 2010. The Geography of Auto Globalization and the Politics of Auto Bailouts. Cambridge Journal of Regions, Economy and Society. III (3): 383–405.CrossRef
Metadata
Title
The Boom of the Mexican Automotive Industry: From NAFTA to USMCA
Author
Alex Covarrubias V.
Copyright Year
2020
Publisher
Springer International Publishing
Book
New Frontiers of the Automobile Industry

Print ISBN: 978-3-030-18880-1

Electronic ISBN: 978-3-030-18881-8

Copyright Year: 2020

DOI
https://doi.org/10.1007/978-3-030-18881-8_13