Delays in Mexico to impact automakers resuming U.S. production

In turn, the lack of components from Mexico could delay the resumption of second shifts at GM truck assembly plants in Fort Wayne, Ind., and Flint, Mich., Reuters reported last week. U.S. plants for several automakers, including Hyundai and Mercedes-Benz, are monitoring their parts supplies from Mexico and beyond as they seek to increase output.

The Mexican restart is also likely to be choppy as local authorities grapple with rising coronavirus cases, particularly in urban areas that are home to major vehicle assembly plants and supplier factories. As of last week, the nation reported 59,567 infections and 6,510 deaths.

The governor of Puebla state, Miguel Barbosa, said Friday that he would postpone the restart of the auto industry there because of rising COVID-19 cases. Volkswagen and Audi have large operations in the state, as do suppliers. But it was unclear whether Barbosa can legally overrule the federal decree that allowed the industry to resume activity last week once its worker-safety plans are approved.

Mexico makes about 20 percent of all vehicles produced in North America, according to IHS Markit, including Ram and Toyota pickups, plus popular crossovers from GM, Volkswagen, Mazda, Nissan and Audi. Mexico’s National Auto Parts Industry group estimates U.S.-built vehicles have an average of about $5,000 worth of Mexican parts from 1,500 supplier plants.

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