Méxique

Alvarez, Lourdes, & Francisco García (2011).  China and México: competition for the United State automobile Market. Gerpisa colloquium. China and México: competition for the United States automobile Market Lourdes Alvarez Medina Francisco Javier García Pando The emergence of the People´s Republic of China (China) in the global automobile industry has given way to a great deal of speculation on what strategies Chinese car makers will pursue in entering the United State of America (USA) market, threatening the established order among the automotive producers in México. Since the automobile industry is considered by the Chinese government as “the typical- capital- and technology industry , to encourage export of cars and components or investment abroad and good for enlarging exports and being significant for the transformation of foreign trade and economic cooperation” (Annual report, 2010). The aim of this paper is to study the trade of automobiles and components from China and Mexico toward the USA market. This country is the main partner of the automobile industry in Mexico; however China has been increasing its exports component in the last years and now it may be seen as a rival contending for the same market. The study is made using the methodology developed by the Comisión Económica para América Latina y el Caribe (CEPAL) and its data base Magic (CEPAL, 2010). Trade is studied at a 10 digits disaggregate level, according to the Harmonized Tariff System of the United States in order to understand which cars and components are being imported from each country, the dynamics and how they are contending. The export similarity index of exported autoparts from China and Mexico to the USA is calculated to compare the trade structure of the two countries.

Thème: Les industries automobiles

Thème: Automobile industries

Contreras, Oscar F., & Jorge Carrillo (2011).  Local Entrepreneurship within Global Production Networks: the Automotive Industry in Mexico (2000-2010). Gerpisa colloquium.

From the decade of the 1980s, Mexico became a highly attractive location for global automobile assemblers. Geographical proximity and low production costs came associated with high productivity levels, making this country an important location in the bitter struggle for market share in the North American market.

As this industry became highly concentrated, driven by a small number of very large assembly firms and a privileged group of highly globalized transnational suppliers, the benefits for the host localities has turned to be a highly controversial issue.

Taking this controversy as a background, a case study was designed to analyze the incorporation of local suppliers around a major assembly plant from Ford Motor Company and its global suppliers in Hermosillo, Mexico. The empirical analysis consisted on a survey applied to a sample of 166 small and medium size local firms, and 56 interviews with managers of transnational firms, owners of local companies, and ex-employees of the Ford plant in Hermosillo. Also¸ the paper analyses a survey on Multinational firms in Mexico in order to determine the diffusion of spill-overs.

Our findings revealed that while most local suppliers could be classified in low added value products and services, with very limited functional roles within the supply chain, a recently emerged trend is the incorporation of a handful of knowledge-intensive small local businesses providing higher value services and playing more important roles within the supplier chain. We analyze the factors that have enable these firms to emerge and evolve, and propose a model of interactions where both enabling and inhibiting factors are considered, with the purpose to improve the understanding of the potential of global production networks to foster local entrepreneurship, and to identify the factor that policies should target in their efforts to promote these emerging firms. 

Thème: Les industries automobiles

Thème: Automobile industries

Alvarez, Lourdes (2011).  The demand of automobiles in Mexico after the economic crisis. Gerpisa colloquium. The demand for automobiles in Mexico after the economic crisis Facultad de Contaduría y Administración Universidad Nacional Autónoma de México GERPISA International Colloquium, 2011, 8-10 june. París Lourdes Alvarez Medina The automotive industry in Mexico provide two relevant markets: the United States market which has had a temporary recovery after the 2008 economic crisis and the domestic market which due to lack of jobs, income inequalities, lack of financing and the entrance of used car imports from U.S. sales, will recover in 2013 the sales levels of 2007. The automotive industry's production in Mexico has had a significant recovery in 2010. Production reached 2.2 million units (49.9%) more than in 2009 and 7.5% higher than 2008. In fact he industry reached its highest peak of production in the history of the industry in Mexico. Likewise the production of auto parts reached a record 60, 000 million dollars, representing an increase of 45% compared with 2009. Exports reached almost 1.9 million, representing an increase of 52% compared with 2009 and 11.6% more than in 2008. Although the domestic sales grew 9% to 820.000 units (of which 409.147 were imported) they were 25.4% lower than 2007 when it reached the largest retail of new cars (1, 099.866) (AMIA, 2010; INA, 2010). The aim of this work is to analyze the effects of the economic crisis in the demand of automobiles in Mexico. Specifically we analyze the factors that shape demand such as household income, financing and the entry of used vehicles from the United States. Since the beginning of the 1980s the economic growth of the GDP per capita in Mexico has been unsatisfactory (0.9% between 1980 and 2007) and macroeconomic stability has not resulted in increasing the standard of living of its population, create new jobs, and keep a solid currency. Several reasons has been exposed: a) the structure of the export oriented manufacturing sector, which is not linked to the local economy, has caused a polarization process and growth has been limited to an extremely small group of firms and households b) the financial sector is not working as it should and therefore is a lack of financing for the private sector c) there is a low investment growth in technology and human capital formation. Employment is one of the most important issues related with the internal demand of automobiles. Mexican economy generated an average of 305 000 jobs annually between 1991 and 2009 whereas the Economically Active Population increased one million. The quality of the formal employment has deteriorated substantially and real minimum wages in 2008 represented less than 30% of their 1980 level and real wages have lagged behind labor productivity. The Gini coefficient has in crease from .385 in 1977 to 0.498 in 2008. We can see the inequality of the distribution in the national patters of income where the first six deciles, which are the 60% of households, amount for only 26.7% of total income while 10% of the households amount for 36% of the total income. The main components of current spending of households are food, beverage and cigarettes (33.6%), transport and communication (18.4%), education and recreation 13.5% and 15.5% in the same period, housing and fuel (10.0%). The inequalities of household income have shaped consumption demand in a specific way. The main share of loans is aimed at the demand of non-durable goods, which are purchased through credit cards. Past due accounts grow up in crisis periods, but in the last year they have shrunk. Pick ups an SUV’s were the category that has experienced the largest rate of growth between 1990 and 2010, and it seems that it will keep the same pace of growth. This demand comes from the VII to X deciles where the richest Mexican households are. Income and social inequalities will remain much the same because the current administration has failed in setting adequate economic growth paths. For the automobile industry, it will remain growing depending on the US market and the demand of the domestic market.

Thème: Transformations de la demande

Thème: Transformations in demand

Martin, Victoria Ma. A. (2011).  The technological development of the auto industry in Mexico. Gerpisa colloquium. The aim of this article is to present the results of a research made in a sample of auto parts enterprises of the auto parts industry in Mexico. The research was made applying questionnaires and deep interviews to managers of the auto parts enterprises. Some of the conclusions are: 1. In spite of the automobile’s manufacturing had begun in Mexico in the 1940’s; the technology applied in Mexico comes from foreign headquarters, this conveys to royalties paid to foreign enterprises. 2. Mexico has not had a fiscal or industrial policy to encourage the development of technology to make competitive the Mexican enterprises, furthermore, Mexico does not have research centers and technological development for the auto industry and there are not links up between the research and educational centers with the enterprises. 3. Mexico was set in the market of the United States and Canada, opening its frontiers abruptly and there is not a public policy to promote technological development for the automobile industry, including new technologies for new engines and the reduction of emissions. 4. Mexico offers: a) low wages, b) tax exemption for imports to be exported, c) poor environmental regulation and d) a fiscal system very favorable to foreign investment.

Thème: Transformations technologiques, transformations systémiques

Thème: Technological transformations, systemic transformations

Sturgeon, Timothy, Gary Gereffi, Kimberly B. Rogers, & Karina Fernandez-Stark (2010).  The Prospects for Mexico in the North American Automotive Industry: A Global Value Chain Perspective. The Prospects and Limits to the Development of the Automotive Periphery. 42, 11-23.

This paper considers the prospects for Mexico’s automotive industry as it has evolved, especially since the signing of the North American Free Trade Agreement (NAFTA) in 1994, in the context of these nested and highly dynamic global and regional value chains.  We find that the fate of an industry in a small, regionally embedded country like Mexico is tied to factors that lie largely outside the control of the state or of local firms.
Ironically, the flagging prospects of the Big 3 automakers have created more risks for Mexico and Canada than it has for the United States.
 

Biblio: The Prospects and Limits to the Development of the Automotive Periphery

Alvarez, Lourdes, Julio Castellanos, María Antonieta Martín G., & González Ma. Luisa (2010).  Performance and perspective of the automotive industry in Mexico after the 2009 economic crisis. Gerpisa colloquium. Since the beginning of the 1980s Mexico has undergone an impressive process of economic openness, trade liberalization and macroeconomic stabilization thus averting extreme currency devaluation, two digits inflation and an acute fiscal deficit. However these changes reduced the dynamics of the domestic market while exports were unable to compensate for the decline. The economic growth has been unsatisfactory; it has failed to increase the standard of living of its population, create new jobs, and keep a solid currency. The 2009 economic crisis found a slow growing economy unable to overcome the situation and the Gross Domestic Product (GDP) decreased. Still the automotive industry in Mexico is linked to the economic growth of the United States, and this resulted in improved performance in the beginning of 2010. In this work we study the effects of the world economic crisis on the Mexican automobile industry and focus on two analyses: First we describe the automotive industry evaluating its dimension and explaining the strategies developed to face the 2009 crisis and their results. In the second part we focus in a local case, analyzing the cluster located in Aguascalientes. The main focus of the study is on the perception that the auto-parts company managers have of the main problems they deal during their insertion into the automotive industry’s value chains. The history of the Automotive Industry in Mexico is intrinsically linked to the government policy that promoted the economic and industrial development, and it can be clearly traced to the automotive decree of 1962. During the 25 years that followed, the government tried to keep and create a national automotive industry in which there were even Mexican automotive and OEM factories. With the coming to power of a new political class, new free trade agreements and decrees gave privileged terms to transnational companies some of this measures resulted in a foreign owned industry and the impossibility to shape an automotive industrial policy that was convenient to the country and their citizens. Between 1994 an 2008 the development of the automotive industry, has been described both as a success and as a failure. First the industry achieved some level of competitiveness as an export platform, increasing its intra industry trade and integrating into the North American market. Under the NAFTA, the automotive industry increase production, received foreign direct investment, created employment, and also improved contribution to GDP and to regional development with the creation of automotive clusters. The automobile industry was regarded by some policy makers as the vertebral column of Mexico´s economy. However exports were not as strong contributors of economic growth as they thought: the productive chains and clusters did not substitute for imports, reliance on imported parts has meant that national suppliers could not be integrated into the value chain. The internal market was unattended; real wages in the industry decreased while productivity increased. University/ industry relationships are limited once there is low development of capacities in segments with more technological requirements and high added value. The automobile sector represented in 2007, 3% of the GNP and 18.8% of the Manufacturers' GNP; 2008 kept 3.5 and 18.8% while 2009 decreased to 2.3 and 13.3% respectively. This is related with the achievement of the United States and Mexican economy which has a GNP of -7% The vehicle manufacturing, which increased in 2007 to 2,146,959, 80% (i.e. 1,700,000) were for export, totaling $31.771 billion U.S. dollars. Export of OEM parts was around $15.291 billion U.S. dollars. The sum of these two is $47.062 billion U.S. dollars which is 25% higher than the crude oil sales in the same year (the oil revenue accounts for financing 35% of the national public expenses). During 2008 vehicle production grew by 4%, but not for the manufacturing and export of OEM parts, which fell by 11% representing $1.640 billion dollars. The last quarter of 2008 fell by 10% compared to the last quarter of the previous year. As a consequence all assembly and OEM plants initiated temporary layoffs and reduced the workforce. Production in 2009 fell 28.3% or 596 thousand units compared to 2008, totaling 1,507,527 units, this implies that exports fell 26.8% during the year. Internal sales fell 26% compared to the previous year. The last quarter of the year has shown an important increase in production and sales of about 15%, leaving hopes for improvements in 2010 and the years that follow. Also, in 2009 there have been investments from VW and the three North American companies, which could be interpreted as a symptom that the worst of the crisis is left behind. The temporary layoffs increased and there were layoffs of about 15%. The main export market has been the U.S. with over 70% of the total exports, followed by Germany with 15%. This fact clearly shows the potential growth of the so called "mexican auto industry" in the years that follow.

Thème: Macroeconomic configurations and national policies in the crisis

Thème: Configurations macroéconomiques et politiques nationales dans la crise

Bensusan, Graciela, & Jorge Carrillo (2010).  Transnational corporations, employment practices and social responsability in Mexico. Gerpisa colloquium.

TRANSNATIONAL CORPORATIONS, EMPLOYMENT PRACTICES AND SOCIAL RESPONSIBILITY IN MEXICO

By Graciela Bensusán (UAM) and Jorge Carrillo (COLEF).

 

ABSTRACT

Diverse studies evaluating the results obtained from the defense of workers’ rights in a context of ongoing productive restructuring through various means and instruments—national and international, public and private, linking and non-linking—emphasize both their potentialities and limitations. In particular the implementation of Codes of Conduct in multinational corporations (MNCs), including those with a sectorial scope, as an alternative or complement to national regulations, has generated immense disappointment among specialists. Thus the debate continues on the best way to avoid a race to the bottom with regard to the quality of employment. This is especially important in a context such as the one we are currently experiencing, marked by the crisis of the neoliberal model and the consequent restructuring of companies in response to intense competitive pressure.

Some of the questions emanating from this debate are the following: What is the effect from the development of global production chains led by multinational corporations (MNCs) and the various ways of organizing these chains, on the capacity of old and new actors (labor unions and NGOs) to put an end to competitive strategies based on attacking working conditions, and what type of factors has an impact on this result? In what way may the demand for social responsibility on the part of MNCs and their suppliers and contractors, through non-obligatory private protection instruments such as Codes of Conduct, counteract the weakening of state and labor union capacities to protect the quality of employment? Are new public and private efforts being made to compensate for this weakening?

In an attempt to respond to these questions, this chapter seeks to compare the tendencies of restructuring in two activities, specifically the manufacturing industry and the service industry, and especially the tendencies related to the modalities and implications of outsourcing by multinational corporations, and the roles played by the different actors in this process.

This study has been conducted within the framework of the debate generated around the way in which deficits in regulations are compensated for within the domestic sphere of the globalization process and the resulting impacts on employment. Particular focus is given to the criticisms of new governance theories that established the basis for the search for “productivist” and “managerial” solutions, such as the promotion of corporate social responsibility and codes of conduct. In short it is sustained that this proposal is “post-conflict and post-rights, post-state and technocratic,” ignoring the fact that a significant number of the problems involved in the restructuring processes are the result of unequal power relations involving class, gender, ethnicity and other social cleavages that cannot be addressed without the recognition of new rights and the adoption of public policies, together with an efficient state apparatus that demands the fulfillment of such rights and policies (Kolben, 2009).

The restructuring of Mexico’s manufacturing industry has been studied from different angles. In this article we are interested, as already stated, in focusing on the consequences for the quality of employment throughout the productive chains led by MNCs and the power of the actors involved.

In order to compare the effects from the restructuring in the manufacturing and services sectors, we will analyze two business models or investment strategies in Mexico: the maquila model that seeks efficiency in international markets through the exporting of manufactured products, and the model in which national markets are penetrated through service-providing businesses seeking competitiveness in regional or local markets (Mortimore, 2006).

In order to typify the business models and their labor implications, we will use a survey conducted with multinational companies at the end of 2008 and during 2009, specifically with nearly 170 firms in the manufacturing and services sectors. This was a face-to-face survey conducted with the Human Resources Directors at these firms, and was part of the project Firmas multinacionales en México: Un estudio sobre la estructura organizacional, la innovación y las prácticas de empleo (Multinational firms in Mexico: a study on organizational structure, innovation and employment practices), linked to the international network known as INTREPID (Investigation of Transnationals’ Employment Practices: An International Database).

We will analyze occupational structure, subcontracting practices, and the presence of labor union organizations and other mechanisms of representation used by companies. In order to study the scope of the Codes of Conduct implemented, we will look at the results from previous studies we have conducted, and we will review statistical and documentary sources, as well as in-depth interviews with the involved actors, including federal and local governments. To this end, we will use some cases of specific companies as referents.

Bibliography

Kolben, Kevin (2009), Towards an integrative theory of transnational labor regulation, Draft presented at Regulation for Decent Work Conference. Workshop: Regulating work in global production, July, Geneva.

Mortimore, Michael (2006), Transnationalization of Developing America: opportunities and challenges, CEPAL, Santiago, May 8 (documento de trabajo)

 

Thème: Innovation et changement dans la nature de l’emploi et des compétences

Thème: Industrial relations and transnational trade unions coordination