Matamoros, Mexico strike update

This 12 January 2019 video is about striking workers demonstrating in Matamoros, Mexico.

By Eric London and Andrea Lobo:

Matamoros strike grows as Mexican ruling class warns of national strike wave

2 February 2019

The strike of tens of thousands of Matamoros workers spread beyond the maquiladoras this week to new industries as workers in water purification, milk production, and Coca-Cola bottling walked out of their Matamoros workplaces Thursday and Friday.

Several additional auto parts maquiladoras also joined the strike at the end of the week, including at Spellman, Toyoda Gosei Rubber and Tapex. Although over a dozen plants have returned to work after the companies granted the 20 percent wage increase and $1,700 bonus, more than 25 remain on strike, costing the mostly US-based companies a whopping $37 million per day.

At the same time, a strike of 30,000 teachers in the state of Michoacan neared the end of its third week with thousands of teachers blocking train tracks linking industrial hubs with the critical Pacific ports at Lázaro Cárdenas in Michoacan and Manzanillo in Colima. Last Monday, thousands of teachers in Oaxaca joined the strike.

Noticieros Televisa wrote Thursday that the teachers’ blockades “impact not only national industries but also their principle trading partners in Asia. In Guanajuato, the auto industry already reports an impact to supply lines.”

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The Mexican ruling class is terrified of the growing strike movement.

In an article titled “The end of labor stability”, Mexico’s main business paper, El Financiero, warned on Thursday that “not in decades has Mexico been presented with 44 strikes in only one blow.” In comparison to recent weeks, the six-year presidential terms of Vicente, Felipe Calderón and Enrique Peña Nieto saw only 49, 40 and 23 strikes respectively.

“As easy as one two three, the labor stability which we have maintained for decades, with hundreds of thousands of successful contract negotiations, is broken. And it won’t stop there”, El Financiero wrote, warning that the future will bring “polarization” and “a growth of the contradictions between capital and labor. It is the end of labor peace.”

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Milenio newspaper warned that “there is a fear of a contagion in the border region, where millions hope for an increase to their incomes.” The paper quotes an anonymous business leader who said, “This is without precedent. We are all involved in what here will mark what will be the future of manufacturing in this country.”

The industry website Manufactura.mx reported that a corporate representative said industry workers were “contaminated” by the demands for a 20 percent wage increase and that companies anticipate the strikes will spread. The business representative said, “We have an excellent relationship with the union” and hoped the union would help the company avoid a strike.

According to Noticieros Televisa, in “the maquiladora industry in Baja California [where the largest maquiladora city, Tijuana, is located] there is a fear that workers will launch a strike for wage increases.” Noticieros Televisa reports that maquiladoras are “maintaining dialogue with the unions of the industry with the goal of avoiding a labor stoppage.”

Workers are both excited by the growth of the strike and concerned that the companies plan to betray whatever agreement they reach.

One Matamoros striker said, “We all have to go out together. … The majority of us are already out. The problem is that the union hasn’t helped us and hasn’t represented us. Now we have to go out and organize guards. We are not asking for gifts, only what we deserve.” …

A striking Kearfott worker told the WSWS, “I’m glad for the new strikers. This is for all workers across the border that have that clause in their contracts” requiring wages increase in parity with the minimum wage. “The same companies put it there and now they have to pay. We are the most exploited and least rewarded class. I think that it’s time for them to give back to us what they have taken.”

A worker at Autoliv explained to the WSWS that after the company agreed to workers’ demands, “as soon as we went back to work, they began to fire people.”

A worker at Tyco, which also agreed to the wage increase and bonus, also told the WSWS there is a growing mood to strike again to protect their coworkers from retribution:

“At Autoliv, they are firing a bunch of people without severance or bonus. The manager fires workers and mocks them, telling them that they are not going to pay their bonus or severance. They are being sent to the conciliation and arbitration board and are told that they’ll have to wait half a year or a year to resolve things. Obviously this board is on the side of Autoliv.

“I think that the majority that are now working, many who didn’t even participate in the wildcat strikes, should all strike again to support their fired co-workers. They are already getting their bonus and raise. We are a new generation that didn’t know how to strike. We have won respect whether people like it or not. Maybe it’s not all the respect we need, but this is our first strike and if things don’t get better, our second strike will be more organized.”

Though the US business press is beginning to report on the impact of the strikes in Mexico from an economic standpoint, the websites of the International Socialist Organization (ISO) and Socialist Alternative as well as the Democratic Socialists of America’s (DSA) Jacobin magazine have all ignored the strike entirely.

This 26 January 2019 video in Spanish is about the Matamoros strike.

By Shannon Jones in the USA:

The economics of the North American auto industry

How global auto parts corporations profit by exploiting Mexican workers

2 February 2019

The massive strikes by maquiladora workers in Matamoros, Mexico, have brought to public light the highly exploitive conditions faced by those laboring for global auto parts makers and other manufacturing industries along the US-Mexican border.

There are 345 “Tier 1” auto suppliers with a presence in Mexico, according to a recent report by ProMexico, an organization set up by the Mexican government to promote international trade and development. Some 65 percent in direct investment in Mexico is in auto-supply-related industries.

The profits extracted off the backs of Mexican workers are a source of enormous enrichment for stockholders and CEOs of the transnational auto parts suppliers, many of them based near Detroit, Michigan.

Auto parts production in Mexico is closely integrated with the global car market, with many of the parts made in Matamoros and other cities shipped to the US. The border crossing at Brownsville, Texas, handled trade worth $14.7 billion in 2017. Auto parts are Mexico’s second leading export, behind petroleum.

The following are profiles of just a few of the multinationals and leading personalities involved in auto parts production in Mexico.

Aurora, Ontario-based Magna is the world’s fifth largest auto parts manufacturer, with $39 billion in sales in 2017 and pre-tax income of $3 billion. It recently opened a plant in Querétaro, Mexico, to manufacture molded and exterior parts. It employs some 24,000 workers in Mexico at 30 different facilities including in Matamoros.

Don Walker, Magna CEO, is one of the most heavily compensated executives in Canada, with $20.4 million in salary. In addition, he has $25.4 million in stock options that he has not exercised and $10.2 million in stock-based wards that have vested but not been paid out.

Lear Corporation, based in Southfield, Michigan, has some 46,000 employees in Mexico and operates 23 plants, according to one report. It recorded sales of $21.1 billion in 2018 and net income of $1.15 billion. In 2017, its top five officers took in some $34 million in executive compensation, including former president and CEO Matthew Simoncini who alone received $14.8 million.

Autoliv, based in Auburn Hills, Michigan, outside of Detroit, bills itself as the world largest automotive safety supplier. It has manufacturing plants in Tijuana, Matamoros and Lerma, with three manufacturing plants in Querétaro, and employs a total of 11,000 in Mexico. It makes airbags, seatbelts, seatbelt webbing and airbag cushions. Workers at the Autoliv plant in Matamoros were among the first to go on strike, and workers now report the company is firing workers in retribution.

The company reported pretax income of $506 million in 2017 on sales of $10.4 billion. Mikael Bratt, president and CEO of Autoliv, pulled in a relatively modest $1.7 million in executive compensation in 2017. Mats Backman, Autoliv chief financial officer, made $1.5 million.

French-based auto parts maker Faurecia operates 14 plants employing 10,000 in Mexico. The company recorded $24.17 billion in auto component sales in 2017. It is the sixth largest auto component maker in the world and produces seats, interior systems and emission control technology. The company’s US operations were recently the subject of an exposure by the World Socialist Web Site Autoworker Newsletter.

Typical of the rapacious character of global auto parts manufacture is Dura Automotive. Its Matamoros factories produce parking brake cables and body engine release cables and other components for major auto manufacturers including Ford, Fiat Chrysler, General Motors, Honda and TRW, Subaru and KIA.

The owner and CEO of Dura, Lynn Tilton, is described by Forbes as a “self-made woman,” with estimated net worth of $830 million. As founder and owner of private investment firm Patriarch Partners, she buys distressed companies, carries out brutal downsizing and then sells them for a profit. In 2016, the Securities and Exchange Commission filed fraud charges against Tilton and Patriarch Partners alleging that the true value of funds it managed were hidden from investors.

Tilton reportedly commutes to her New York office by helicopter and “owns homes in Florida, Arizona, Hawaii, and an Italian villa on Lake Como, just up the mountain from George Clooney,” valued at $60 million or more.

In an interview with Forbes, she boasted of owning $25 million in jewelry and another $10 million in aircraft. She reported that she has a reality show about her business (“Diva of Distressed”) in the works with the Sundance Channel. She showed the Forbes reporter a statement from her accountant of assets like gold, silver and cash totaling $544 million.

Tyco International is another multinational conglomerate with operations in Matamoros. It merged with Johnson Controls in 2016 to form Johnson Controls International plc.

The company’s former chief financial officer, Mark Swartz, and former CEO, Dennis Kozlowski, were convicted in 2005 of crimes related to the receipt of $81 million in unauthorized bonuses, the purchase of $14.7 million in art and the payment by the company of a $20 million investment banking fee to a former Tyco director.

Another Tyco executive, Edward Breen, who replaced Kozlowski, got a golden parachute when he left his post as CEO of in September 2013, with compensation, retirement pay, stock and other perks valued at more than $150 million.

Breen, who remained Tyco chairman, got an additional $30 million as a lump sum pension payout in 2016, Tyco says. He has since been named CEO of Dupont, where he received 2018 compensation of $13.7 million, and also serves as a director of cable giant Comcast.

Another major player in the auto parts industry in Mexico is International Automotive Components Group IACG, formed by now US Treasury Secretary Wilbur Ross in 2006. Ross became notorious as an asset stripper, buying distressed companies and then imposing major attacks on workers and retirees. He worked with the United Steelworkers union to rob tens of thousands of retirees of their pensions at LTV Steel and other companies.

A ferocious advocate of trade war within the Trump administration, the firms Ross operates exploit the labor of workers all over the world. The single-minded drive by the Trump administration to scapegoat immigrants and to build a wall with Mexico is bound up with the determination of the ruling class to keep workers in Canada, Mexico and the US divided in order to be able to more efficiently exploit their labor.

Up until June of 2018 the president and CEO of IACG [was] Steve Miller, the former head of Delphi Automotive, now Aptiv, another major auto parts manufacturer with operations in Mexico. He is a ruthless enemy of the working class, using the bankruptcy of Delphi in 2005 to impose massive job cuts and concessions onto workers and retirees

Following the Delphi bankruptcy Miller spelled out a vision in which low wages in China, Mexico and other less-developed countries should set a standard for slashing wages and pension benefits in the US. He called decent pay, defined benefit pensions and retirement after 30 years of employment an anachronism that American business could no longer tolerate or afford.

Taking aim at Medicare and Social Security, he wrote, “The overwhelming voltage in the political third rail of touching these entitlements will forestall corrective action for years, but the problem will only grow. I fear something like intergenerational warfare, as young people increasingly resent having their wages reduced and taxed away to support social programs for their grandparents’ income and health-care concerns.”

At the same time as he was slashing jobs and pay for workers, Miller became notorious for handing out hefty compensation packages to Delphi executives. Miller himself received a multimillion-dollar signing bonus when he was hired as Delphi CEO just months before taking Delphi into bankruptcy.

This is the background of the strikes by workers in Matamoros who have courageously sought to pry back a tiny portion of the profits extracted by the transnational corporations.