First Brands Bankruptcy Hits Auto Plants in Northern Mexico

The automotive supply chain in northern Mexico is facing significant disruption following the Chapter 11 bankruptcy filing of US-based First Brands Group. The financial collapse has triggered the immediate closure of several manufacturing subsidiaries, leaving approximately 1,400 workers unemployed in Matamoros and affecting hundreds more at maquiladoras in Ciudad Juarez.

At Tridonex, a Matamoros-based subsidiary specializing in brake systems and automotive components, 1,090 unionized workers and about 300 administrative employees were notified—via social media—not to report to work. In response, workers established round-the-clock guards at the company’s facilities in the Finsa Industrial Park. Despite sub-zero temperatures, employees are monitoring plant entrances to prevent the removal of machinery or equipment, seeking to safeguard assets to ensure future severance payments.

Legal Proceedings and Labor Demands

Mexico’s Labor Conciliation and Arbitration Board has set up temporary workstations outside the Tridonex facilities to process worker claims, including those from employees with up to 25 years of seniority. Under Mexican labor law, the company has five business days to respond to a formal summons regarding the suspension of operations. If it fails to do so, a collective lawsuit will be filed through the SNITIS Movimiento 2032 union.

In Ciudad Juarez, 260 workers took control of the Hopkins maquiladora located in the Gema Industrial Park. At the same time, employees at Centric Parts—a division of Brake Parts Inc. (BPI) and an affiliate of First Brands Group—initiated similar actions. Legal representatives for Centric Parts told workers that the company currently lacks the liquidity to cover payroll or severance obligations, citing the depletion of operating funds.

Causes and Sector-wide Risks

The Federation of Autonomous Independent Unions in Mexico (FASIM) attributed the closures to a combination of declining sales, financial mismanagement and the impact of tariffs on raw materials imported from China. The union has issued strike notices to initiate asset attachment proceedings, aiming to prevent the decapitalization of the plants before workers are compensated.

Labor lawyer Susana Prieto Terrazas warned that the bankruptcy of the US parent company poses a significant risk to other automotive manufacturing operations in Mexicali, Baja California, and the Bajio region, according to La Jornada. She also reported alleged irregularities in Ciudad Juárez, where the local Labor Conciliation Center reportedly attempted to validate a new union presence amid factory shutdowns—an action she described as a legal maneuver designed to facilitate bankruptcy filings at the expense of workers’ accrued benefits.

Economic Impact in Tamaulipas

Enrique Salinas, Matamoros’ secretary of economic development, said the company has not yet issued an official statement regarding the closures. While urging workers to adhere to legal procedures, he acknowledged widespread concern over the company’s ability to meet severance obligations. Salinas pointed to similar cases in 2023 involving Componentes Universales and Edemsa, where plant closures led to prolonged legal disputes that remain unresolved.

The crisis follows a period of financial restructuring at First Brands Group that began in late 2025. During that phase, supply shortages forced Tridonex to place workers on reduced schedules with 75% pay. By early 2026, those temporary measures had given way to permanent shutdowns, placing severe strain on the automotive components sector across northern Mexico.