B Y A L M A O S O R I O & K A R L A V E L A S C O
HYPOTHESIS
NAFTA has allowed the big automotive companies, such as Ford, to benefit largely from the lose work regulations in Mexico as well from the inability of workers to organise and demand higher wages. In a weak institutional setting, workers are not able to confront big corporations and thus, are unable to close the existing gap between the Mexican and the American workforce. We find that, although Ford vows to offer the same conditions to all of its workers throughout the world, this is not a reality when we compare the salaries of their employees in Mexico and the US. It is not entirely clear whether Mexico is “capturing the gains” by participating in the Global Value Chain of the production of Ford cars, as the typology of its workforce isn’t upgrading to a more high-skilled-technology-intensive or information-intensive one.
FORD MOTOR COMPANY
TOTAL GLOBAL BUY
$100+ bn
100,000+Parts currently being manufactured
60+Countries in which suppliers are located
62Ford manufacturing sites
4,400 Supplier sites
500+Production commodities to manage
22High-risk emerging markets
Automotive Industry
VIDEOS
She Calls My Name
Come Here Anytime
Haor Bachashecha (acoustic)
Automotive Industry
Domestic Tier N Suppliers
Global Tier N Suppliers
Tier 2
Suppliers
Tier 1
Suppliers
Original
Equipment
Manufacturer
3rd
Party
Logistics
Dealers
You
Ford Motor Company's Supply Chain
Assembling and Stamping Plant
WORKING STANDARDS
Policy Letter 24 is the basis of their work with suppliers, which addresses their Human Rights Code, Basic Working Conditions and Corporate Responsibility. This policy reflects workplace issues such as working hours, child labor, forced labor, non-discrimination, freedom of association, health and safety, and the environment.
"As more fully provided in Policy Letter No. 2: Relationships with Employees, the diverse group of men and women who work for Ford Motor Company (the “Company”) are our most important resource. In recognition of their contributions, the Company has policies and programs designed to ensure that its employees enjoy the protection afforded by the principles articulated in this Policy"
CONCLUSION
According to the data, the relationship between Mexico and the Ford Motor Company is highly asymmetric, as well as the wages and working conditions between Mexican and American workers. Even though it is Ford’s policy to treat all of their employees equally, no matter their location, this is not a reality. NAFTA is responsible for this in some extent, because after its signing many transnational corporations, like the Ford Motor Company, started to relocate some of their processes in Mexico, mostly because of cheaper labor and lowers costs. The cheap cost of Mexican labor ends up being a competitive advantage and one of the main reasons the Ford Motor Company has decided to invest in its neighbour country. Despite the long history of the company in Mexico, the typology of the workforce hasn’t upgraded much, or at least not fast enough.
According to Pro México, out of the 40 top vehicle manufacturers established in Mexico, only 5 are Mexican companies
Ford's Global Value Chain
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