• AUTOMOTIVE: Mexico’s auto sector prevented major layoffs in April with employment falling by a mere 2.4% from March despite the country facing its most drastic manufacturing downturn on record due to the coronavirus shock, according to new data from Mexico’s statistics agency (INEGI).
• NUMBERS: As Mexico entered its first full month of shutdowns under the coronavirus emergency, automakers and the auto parts industry shed a relatively small number of jobs through negotiations with unions. The Mexican auto sector recorded 916,337 in April down from 939,282 in March.
• AGREEMENT: “Given that (companies) already had experience with other economic crises, they sent people home prior to reaching an agreement with unions to cut wages when possible. This prevented drastic layoffs”, said Armando Soto from the Kaso y Asociados consulting firm.
• RESILIENCY: According to experts, the relatively small jobs loss in April also was a result of auto sector companies trying to avoid costly severances at a time of a major liquidity shock. In June, most automakers with operations throughout Mexico began phased-in reopenings.
