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Friday, 19 April 2019 21:59

Border Closure Could Have Adverse Effects on WV Automotive Industry

Written by Rebecca Carballo, Charleston Gazette-Mail
Team members at the Toyota Motor Manufacturing West Virginia plant in Buffalo put the finishing touches on a group of 4-cylinder engines. Team members at the Toyota Motor Manufacturing West Virginia plant in Buffalo put the finishing touches on a group of 4-cylinder engines. Courtesy photo


As President Donald Trump continues to consider closing the United States’ border with Mexico, West Virginia business owners and industry advocates worry about the effect it could have on the state’s automotive sector.


Trump tweeted in late March he was considering a closure. On April 12, The New York Times reported that Trump had urged Kevin McAleenan, his choice as acting secretary of homeland security, to close the country’s southwestern border.


Mexico is West Virginia’s 11th-largest trading partner based on dollar value, according to 2018 Census data. Trade with Mexico supports 23,000 jobs, according to a 2017 report from the Wilson Center, a nonpartisan research institute. West Virginia’s exports to Mexico have increased by 378 percent since 1993, according to the report.


“There is serious and widespread concern that closing the border with Mexico would be crippling for the United States automotive industry, which could mean similar consequences for West Virginia automotive manufacturers,” said Rebecca McPhail, president of the West Virginia Manufacturers Association.


Right now, West Virginia’s automotive industry is growing, McPhail said.


In 2013, Allevard Sogefi promised a $20 million investment and more than 250 jobs at its Wayne County plant. In March, Toyota officials announced the company’s plant in Putnam County would double its production line, creating 123 jobs.


“Virtually every automaker in the United States depends on parts imported from Mexico,” McPhail said.


There is an intricate supply chain between the U.S. and Mexico. Parts can cross the border as many as seven times before the final good is produced, McPhail said.


For Allevard Sogefi, a global manufacturer, a border closure could mean losing about one-third of its business, plant manager Troy Thomas said. The Prichard plant does business with four plants in Mexico, which largely depends on transporting goods via truck.


“There’s no other way. You can’t ship them by sea without going through the Panama Canal, and shipping by air would be enormously expensive. It’s truck or nothing,” Thomas said.


Sogefi also receives three to five truckloads of raw materials from Mexican suppliers every week. Those supplies are not only for products it ships to Mexico, but products Sogefi sells in the U.S. as well.

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