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News Article

Puebla to Automate Manufacturing; Reduce Personnel for 2022

By Antonio Gozain | Mon, 08/23/2021 - 15:36

The automotive industry is going through uncertain times, following the COVID-19 pandemic and the supplies shortage. If the situation continues until 2022, the sector should consider saving strategies such as the reduction of personnel through automation of the manufacturing process, according to the National Chamber of the Transformation Industry (CANACINTRA).

“When the industries of the (manufacturing) sector see a contraction in the market that could continue for the next year, then there is no choice but to invest in automation to reduce operating expenses,” said in press conference Luis Espinosa Rueda, President of CANACINTRA Puebla.

Espinosa also explained that there will not be new hirings in the automotive sector during the rest of 2021, due to the crisis the industry is facing. This will directly affect Puebla, since manufacturing industries, leaded by Volkswagen de México, represent 22.4 percent of the state’s GDP, according to INEGI. An internal diagnosis carried out by the manufacturing sector, identified that there are up to three people doing the same activity, explained Espinosa. He added that some of the 85 suppliers considered to be overstaffed will be forced to invest in automation to reduce their workforce only to specialized supervising personnel, the necessary minimum.

The main objective is to make Tier 1s and 2s more efficient, insisted Espinosa, and oversee their quality as Volkswagen and Audi suppliers. Further investing in automation is not a new idea, he explained, since the companies had already considered it during 2015’s “dieselgate.”

Automating manufacturing companies might compromise Puebla’s plans to recover the jobs lost during 2020. Between the economic reactivation in August 2020 and 1H2021, only 9,000 jobs were created, from the 45,000 lost during the COVID-19 pandemic, said Ignacio Alarcón Rodríguez Pacheco, President of the Business Coordinating Council (CCE).

Espinosa addressed the job loss, saying that while not ideal, it was necessary: “It is clear that (the manufacturers) need to bet on greater automation to also increase their installed capacity and consequently improve the production, since the automotive industry is one of the main engines of the state’s economy, for which the activity must be taken care of with a greater robotization because it is the trend in the coming years.”

Espinosa talked about three new investments in the state, including one in the automotive sector. He did not reveal the amount but referred to it as “not spectacular yet important for Puebla” since it will create up to 2,000 jobs.

Audi, Government to Amend Agreement

Audi and the government of Puebla kicked-off discussions to amend the toll subsidy agreement for the automaker employees, said Espinosa. This agreement was reached between Audi and other administrations and concluded recently. However, Governor Miguel Barbosa Huerta said that Audi workers will not have to pay in San José Chiapa’s toll booth.

The data used in this article was sourced from:  
Antonio Gozain Antonio Gozain Journalist and Industry Analyst