Blog: Dave LeggettDelphi shifting production out of Mexico

Dave Leggett | 28 August 2003

Sean Kelly, executive director of Delphi Mexico, has told Reuters that production volumes in Mexico have fallen by 3 to 5 percent this year from last year, and the company is evaluating the possibility of moving production contracts to countries including Brazil, China and eastern Europe. That reinforces the comments of James Orchard in a recent interview with just-auto. He said that Mexico is 'just not cheap any more'.

But it's not all bad for Mexico, as Orchard seemed to be saying that Delphi's Mexican facilities are moving up the value added chain and total revenue from Mexican facilities will continue to grow. And that's the important thing in the international competition for business. Losing out to places like China on commoditised business is perhaps inevitable in the long-run - but you have to replace that with higher added value activity, or face industrial decline.


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