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Mexico creates confusion, announces auto factories will reopen June 1

Benzinga · 05/15/2020 17:56


In the face of a worsening health crisis, the Mexican government announced that auto factories may reopen on June 1, and not Monday as originally announced.

The new decree is a reversal from Mexican President Andres Manuel Obrador's recent announcement that construction, mining, and auto manufacturing would be considered "essential activities," and could resume next week.

The new decree to restart factories June 1 came as a surprise to many auto industry officials who were expecting to open next week.

"What they did was not a misprint, they changed the agreement on us. The plants cannot start operating on [Monday]," Eduardo Solís, a member of the board of directors of Mexico's Confederation of Industrial Chambers (CONCAMIN) said in news outlet Expansion. "It seems to me that this was the result of the struggle that exists in the government between the health issue and the economic issue."

Solís added that many auto factories in Mexico were ready to resume operations by Monday and that delaying the start may harm supply chains between factories in Mexico and the U.S.

"Honda restarted operations in the U.S. but is already considering closing the plant again because they cannot receive parts from Mexico," Solís said. "We run the risk of losing this status of ‘reliable partner' that has cost us so much work to build."