Migration may be starting to impact the Mexican automotive industry along the US-Mexico border. Meanwhile, the United Auto Workers Union’s (UAW) strike continues to take its toll on Detroit’s Big Three, with Tesla potentially standing out as one of the beneficiaries of this work stoppage.
Put your seatbelt on, this is the week in automotive:
The Mexican Association of the Automotive Industry (AMIA) has issued a cautionary statement regarding the impact of a recent surge in migration on the country’s automotive sector. AMIA reports that the situation has resulted in commercial transit suspensions at critical border crossings, leading to significant delays and economic setbacks. Mexico has experienced a notable surge in migratory activities, resulting in the suspension of freight train services due to the presence of numerous migrants on trains and railway tracks.
Tesla Emerges as Top Beneficiary in UAW Strike
The United Auto Workers Union’s (UAW) strike could benefit Tesla due to its status as a non-unionized company. This situation allows the company to reduce operational costs and salaries while maintaining interrupted car production. However, if Detroit’s Big Three accept the proposed deal put forth by the UAW, it could result in an increase in the average price of an electric vehicle and impact Tesla's efforts to further reduce production costs.
Car sales in Mexico hit a significant milestone in September 2023, which marked the highest sales for the month since 2016, as reported by the National Institute of Statistics and Geography (INEGI). A total of 118,038 vehicles were sold domestically, reflecting a surge in demand that may have implications for year-end sales projections. The industry's performance in September represents a 35.6% growth compared to the same month in 2022. This performance exceeded the earlier forecast provided by the Mexican Association of Automotive Distributors (AMDA)
Ford’s plan to build a S$3.5 billion electric vehicle (EV) battery plant in Michigan, the US, has encountered a series of complications, raising uncertainties about the project’s future. Ford opted to suspend construction of the battery plant, emphasizing the need to ensure competitiveness before proceeding. This pause coincides with national contract negotiations between Ford and the United Auto Workers (UAW) union, which seeks to represent workers at battery factories and improve wages.
Former US President Donald Trump addressed autoworkers in suburban Detroit, Michigan, on Wednesday evening. Trump, the current Republican front-runner for the 2024 presidential race, delivered a speech critiquing electric vehicles (EVs) and warned of the decline of the US auto industry under Democratic leadership, particularly US President Joe Biden's policies.
The US has called upon Mexico to conduct a thorough review of labor conditions at the Teklas Automotive facility in Aguascalientes. This request marks the ninth such request made by the US in 2023 and the fourteenth overall under the provisions of USMCA, which came into effect in 2020. This call for action is a response to allegations of severe labor rights violations, particularly concerning actions taken by the employer against employees engaged in union activities.
Cutting-edge automation is reshaping the automotive industry, tells Sergio Padilla, CEO, Boltronic, to MBN this week. “Our purpose is to bring technology into people's everyday lives. This goes beyond merely making a robot move; it is about ensuring that technology enhances quality of life,” he says.
Felipe Gallego Llano, COO and Co-Founder, MegaFlux, looks at the good and bad of EV subsidies and how to find the middle ground. “In Mexico, we have seen positive impacts of incentives, such as support for the purchase of hybrid or electric taxis in Mexico City”, Felipe shared with MBN.