Parts supply shortages from Mexico mean that Mercedes-Benz will temporarily suspend production next week at its US plant in Alabama – Mercedes-Benz US International (MBUSI). The Tuscaloosa plant, which makes the GLS and GLE SUVs, recently reopened after a five-week shutdown caused by the coronavirus and was gradually increasing output. It will now suspend operations next Monday.
“In the first week of the ramp-up MBUSI has begun limited production with a significantly reduced number of team members in one shift,” a spokesperson for the carmaker told Automotive Logistics. “Due to respective country-specific regulations in Mexico and their impact on supplier sites, we are facing temporary interruptions.”
Mexico is restarting its automotive manufacturing but the country’s individual states are setting different rules regarding ramp up, which combined with the requisite authority permits, is restricting the movement of parts across borders. A further complicating matter is the regional differences in the management of the pandemic, something that is having an impact on the 40% of parts being moved within Mexico.
Mercedes-Benz’s spokesperson said managers were “monitoring the situation diligently” and would decide on short notice to start operations as soon as possible.
“MBUSI will also produce during the planned summer shutdown to ensure the required production capacities of the highly demanded SUV models coming out of Alabama,” he said.
It remains to be seen whether the current situation regarding cross border parts supply will be further complicated by the US-Canada-Mexico trade agreement (USMCA), which comes into effect on July 1, and will enforce complex changes in trade, parts sourcing and labour rules.
Watch our Livestream discussion covering the key risks in the Mexican automotive supply chain, and strategies for successfully restarting manufacturing and supply chains, whilst preparing for USMCA implementation
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