U.S.-run plants not ready to resume operations in Mexico

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Maquiladoras struggle to reinvent production practices in compliance with "new normal" safety and social distancing rules

In this Friday, Dec. 27, 2013 file photo, workers manufacture car dash mats at a maquiladora belonging to the TECMA group in Ciudad Juarez, Mexico. A key draw for foreign assembly plants and investment has been Mexico’s low wages. While average manufacturing wages in China had risen to $3.60 per hour by 2016, Mexico’s had shrunk to $2.10 – a level some economists say is artificially low. (AP Photo/Ivan Pierre Aguirre, File)

SANTA TERESA, New Mexico (Border Report) — For the past month, U.S.-run factories in Juarez, Tijuana, Laredo and other Mexican border towns have been sending employees home in compliance with rules to stop the spread of COVID-19.

Production lines in which parts for cars, appliances and computers are put together for shipment to U.S. companies sit idle, and workers are at home making due with half a paycheck.

But even though hundreds of infections and dozens of COVID-19 deaths are still being reported, Mexico has set target dates to reopen its economy and allow factories to resume production under new safety protocols.

To many, that’s a good thing. But border industry experts say they don’t expect most factories to reopen by Monday, or even by the June 1 “hard target” date.

“It’s not as easy as flipping a switch,” said Jerry Pacheco, president and CEO of the Border Industrial Association (BIA). “It’s very uncertain which businesses are going to open and when.”

The main problem is that the coronavirus pandemic is still raging and people are scared. Thirty new cases and five more deaths were reported just in Juarez on Thursday.

Many employees of these plants known here as maquiladoras aren’t planning to show up for work on Monday even if called, and by law, they don’t have to.

“Most of these companies made agreements and signed contracts with employees to pay them full or partial salary through the end of May. So some employees are saying, ‘I’m getting paid, I’m staying home. I’m not going back to work,'” Pacheco said.

Jerry Pacheco, president and CEO of the Santa Teresa, New Mexico-based Border Industrial Association. (Julian Resendiz/Border Report)

The other major challenge has to do with the “new normal” protocols to stave off this or future pandemics.

Buses have to run less than half-full, businesses have to provide personal protective equipment for their employees, procure scarce cleaning supplies, and factories have to reconfigure workspace to allow for social distancing.

“Hundreds of thousands of maquiladora workers are bused to their place of employment. Now buses carry fewer employees to their shift so plants have to work with fewer employees. They’re opening at 25% capacity to keep workers socially distant and account for the fact that a lot of their employees aren’t back,” he said.

Plus managers are having a difficult time procuring masks, gloves, gowns and disinfectant chemicals for their facilities because everyone else is looking for them.

“It’s not a neat process. It’s very uncertain and very frustrating,” Pacheco said.

The U.S-run plants are also realizing they have to reinvent their internal production processes.

For instance, it’s not unusual for the maquiladoras to arrange their workers into teams of five or 10 employees to put together a specific part or component.

“If you’ve ever been inside a maquiladora, you will see people working at a particular place on the assembly line literally on top of each other working together on something. You can’t have that now, so how do you reconfigure, how do you space out your employees?” he said. “Imagine finding proper space for 5,000 people in a maquiladora. It’s a monumental task.”

Then there are the problems on the U.S. side.

In the case of the auto industry, demand for cars is low because of the COVID-19 pandemic and vehicles were stockpiled in anticipation of an interruption in the production cycle.

“I have two firms in Santa Teresa tied to the automotive industry. They’ve furlough their employees and have targeted June 1 as a return there. But if the demand isn’t there, they’re not going to come back and June 1 is just a date,” Pacheco said.

Visit the BorderReport.com homepage for the latest exclusive stories and breaking news about issues along the United States-Mexico border.

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