Gas shortages ‘shut down’ Mexico’s auto plants

The automakers KIA, Audi, Honda, Ford, Nissan, BMW, Toyota and the largest glass manufacturer, Vitro, temporarily suspended operations in some of their plants in Mexico, due to the shortage of natural gas and electrical blackouts registered in Nuevo León, Tamaulipas , Chihuahua, Querétaro, State of Mexico, Morelos and Veracruz.

The automakers’ announcements are in addition to the stoppages announced last Wednesday by Volkswagen in Puebla, Mazda in Salamanca and General Motors in Silao.

The associations representing the automotive industry sent a letter to President Andrés Manuel López Obrador asking for his urgent intervention to reestablish the supply of natural gas and electricity in Mexico.

“We request your valuable support, as you have always shown to guarantee the supply of electrical energy and industrial gas, without reduction in supply or consumption, in order to continue working together on the strength of the economy of our Mexico”, says the letter signed by the Mexican Association of the Automotive Industry (AMIA), the Mexican Association of Automotive Distributors (AMDA), the National Association of Truck and Tractor Producers (ANPACT) and the National Autoparts Industry (INA).

In the letter, they detail that the Mexican automotive sector generates 18.2 percent of the country’s manufacturing GDP, with a positive trade balance of more than 77 billion dollars, more than the oil sector, remittance income and the tourism balance, together .

“This is reflected in more than 2 million direct jobs for our Mexican families, thus being the fifth producer in the manufacture of auto parts, the sixth producer of light and heavy vehicles and the first exporter of trucks in the world”, they refer.

KIA suspended operations on Thursday at its assembly plant in Pesquería, Nuevo León, due to gas and electricity shortages, sources close to the company confirmed.

For its part, Honda scheduled a three-day technical strike at its plant in Celaya, Guanajuato, starting Thursday. In Celaya, the assembler assembles the Honda Fit, HRV and Civic models, in addition to operating an automatic transmission plant.

Honda’s decision to temporarily suspend its activities will force its suppliers to reduce or suspend production.

Meanwhile, Audi of Mexico announced that it will make a technical strike on Thursday and Friday. Through a statement, the firm stated that “guaranteeing the job and economic stability of all employees is the top priority for Audi Mexico, therefore, the Labor Sustainability system will be applied.”

Meanwhile, Ford suspended operations as of Thursday, February 18 at several plants in the United States and in Mexico, the impact will be on its unit located in Hermosillo, Sonora, which stopped due to gas shortage due to the cold, which will adds to the suspension in the industrial complexes of Kentucky, Kansas City, Dearborn and Flat Rock.

Ford anticipated that they could resume normal operations on Monday, February 22.

Nissan, for its part, decided to bring forward some of the shutdowns scheduled for March on line 2 of its Aguascalientes plant in February. The company explained to El Financiero that it will also adapt its production to LP gas to maintain its level of assembly.

“We will closely monitor the issue to make the appropriate adjustments if necessary,” he said.

In addition, Toyota reported that its plants in Guanajuato and Baja California will also make technical stoppages and reduction in production shifts in the coming days due to lack of gas.

“There will be an impact related to the supply of parts and the availability of natural gas in our plants located in the states of Baja California and Guanajuato. At the moment and given the circumstances, we will continue evaluating and monitoring the conditions on a daily basis, ”said the company.

Since February 12, Texas has had a natural gas supply problem due to low temperatures freezing wells and gas pipelines, which affected fuel exports to Mexico.

For its part, Vitro reported that since February 15, three of its automotive glass factories in Mexico temporarily suspended their operations, due to the fact that they stopped receiving electricity and were also notified of possible reductions in the supply of natural gas.

The Monterrey company explained that some of its smelting furnaces had to switch to alternative fuels to reduce natural gas consumption.

“Likewise, we inform you that, since today the plants of the automotive business have begun to receive a light load of electrical energy, they have already been able to partially restart their operations,” said the company.

He added that he took actions to face the contingency, seeking to preserve the integrity of his equipment and operate as far as possible, avoiding affecting clients.

With information Erick Almanza and Luciano Vázquez

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