In Mexico, $2.25-per-hour workers make $40,000 SUVs
In Mexico, $2.25-per-hour workers make $40,000 SUVs
MARK STEVENSON, ASSOCIATED PRESS
September 25, 2017 Updated: September 25, 2017 8:28pm
Photo: Ivan Pierre Aguirre, STR
Workers manufacture car dash mats in Ciudad Juarez. In Mexico, where the auto industry has boomed under NAFTA, the industry has created a class of workers who are barely getting by.
MEXICO CITY - Autoworker Ivan Flores spends his days transporting parts for U.S.-bound Audi SUVs at a plant in central Mexico, but he laughs when asked if he could ever buy one of the $40,000 Q5 SUVs the plant produces on his $2.25-per-hour salary.
"For us it is a dream to buy a Q5; we never could," said Flores, 40, who supports three sons on his roughly $110 weekly paycheck.
The premise of the auto industry since the times of Henry Ford was that workers would make enough to buy the cars they produced. Across the U.S. and Europe, the arrival of an auto plant meant the creation of middle-class communities, with employees taking vacations, buying homes, cars, perhaps even cottages and boats.
But in Mexico - where the auto industry has boomed under the North American Free Trade Agreement, with plants like the Audi factory that opened in Puebla state in 2016 - the industry has created something different: a class of workers who are barely getting by, crammed into 500-square-foot apartments in government-subsidized projects that they pay for over decades.
Many can't afford even a used car, taking home as little as $50 per week after deductions for mortgages and cafeteria meals.
Why have Mexican auto salaries stagnated or declined while pay for Chinese auto workers rose, despite all the promises that North American Free Trade Agreement would increase Mexican wages? That's the question U.S. negotiators are asking as the third round of NAFTA talks resumes in Ottawa, Canada.
Ironically, U.S. President Donald Trump, widely seen here as one of Mexico's worst enemies, is pressing the issue of low Mexican wage rates, saying labor protections should be strengthened.
"It's ironic, right, that he's always criticizing us, but at the same time, he could do something that benefits us, by exposing the rot in the system," said Audi worker Eduardo Badillo, 34.
The key in Mexico's auto industry may be the so-called "protection" contracts signed long before plants open.
As in many factories in Mexico, very few of the current Audi workers ever voted for their union leader, and they won't get any chance to vote for years.
Government records show that on Jan 24, 2014 - almost three years before the Sept. 30, 2016, inauguration of the Audi plant - the company signed a union contract that specified wages as low as $1.40 per hour, up to $4 per hour. The union says nobody receives the lowest wage, with most earning about $2.25.
So when the plant's 5,000 workers finally were hired two years later, they were faced with a union and a contract only a handful had voted for. Given Mexico's lack of good jobs, many do apply, including college graduates. The contract locks in wage increase of about 6 percent per year - which outpaced inflation for a few years but now trails it - through 2019.
"Everybody knows what the conditions are when they apply.
These are the wages, this is the union," said union chief Alvaro Lopez Vazquez. "You decide. If you don't like it, you can look elsewhere."
Lopez Vazquez refused to say how many people took part in the vote when he was elected in 2013; opponents say it was about two dozen. He also said he doesn't plan to call for any voting assembly or meeting until 2020.
"This is a democratic union, where the workers vote ... every six years," he said.
Lopez Vazquez and the company say the plant pays above-average wages for the sector. The company said it has paid workers bonuses and respects the union.
Mexico's minimum wage - which few people make - is about 50 cents per hour.
But the real issue is choice, says former assembly line worker Juan Carmona, 35, who says he was fired for his attempts to call for a union leadership vote. The company denies that, but wouldn't say why he was fired.
Mexico recently changed its constitution to demand that unions signing labor contracts have to show they have the support of the workers they represent. But there has been little to no enforcement. The Labor Department refused requests for comment.
Critics have long accused Mexican unions of doing more to control workers than represent them. The country's biggest labor federation forms part of the ruling Institutional Revolutionary Party.
Low wages - along with closeness to U.S. markets - are the key attractions that have drawn automakers such as Audi, Kia, Mazda, Toyota and BMW to open plants in Mexico over the past couple of years.
http://www.houstonchronicle.com/busi...s-12227831.php
