Although the majority of the automotive sector operating in Mexico is still struggling to shake off the negative effects of the Covid-19 coronavirus, it has achieved an important recovery in record time.

During the second quarter of 2020, vehicle assemblers halted their production, leaving the future of their supply providers in suspense.

However, those who are part of the most important clusters joined forces at the most confusing stage. They provided information, training and exchange of good practices to get afloat until reaching practically the same levels of productivity registered prior to the health crisis.

As they were not clear about what would happen to the industry, a common goal emerged in the clusters, to strengthen ties of collaboration between their members to produce with adequate profit margins and succeed.

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The automotive groups acted as a link between the companies and the state governments to establish adequate health protocols to operate again.

The management office was established where any company that had a contract from an automotive company could be supported with working capital, factoring and leasing to meet its commitments.

During the pandemic, technology was also used to link workers more with companies, an activity led by clusters.

The electrical reform and the disappearance of the subcontracting of personnel, generated a readjustment in the employment situation of thousands of collaborators in various companies linked to the automotive industry. In the clusters, the idea prevails that both adjustments slowed down productivity growth.

Meanwhile, in the north of the country and in the Bajío area, it is believed that the key to take off is in manufacturing linked to the Treaty between Mexico, the United States and Canada (T-MEC).

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Forcing companies to integrate more regional content provides the opportunity to embed more national suppliers into supply chains. Working closely with transnationals and national suppliers to hold business meetings where companies are listed as is done in Asia and Europe, generates a great advantage.

As in any road towards recovery, there are variables that can slow it down and in automotive clusters the approach prevails that due to the shortage of semiconductors throughout the year, stoppages in production lines will continue, for which a good alternative will be seek to diversify and thus be prepared against what may happen in the future.

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Original note