Spanish auto parts makers jittery about Trump effect
Basque and Catalan suppliers stress importance of NAFTA free trade deal to their own businesses
The Spanish auto parts industry is watching with concern as US president-elect Donald Trump issues threat after threat against US companies relocating their production to Mexico. Most Spanish companies with a presence in both Mexico and the US say “it’s still too early” to comment on the Trump effect. But the industry association Sernauto is openly using the word “concern.”
So is Confebask, the Basque business confederation that promotes the interests of regional businesses and entrepreneurs (three out of Spain’s five largest auto parts companies are Basque).
While no auto maker has a Spanish passport, the auto industry plays a big role in the Spanish economy, which has developed a large components supply chain. These parts suppliers have accompanied their clients wherever the latter have chosen to open assembly plants. These places include Mexico and the US.
But now, Trump is threatening to suspend the NAFTA free trade agreement, and is announcing stiff duties for US companies that import cars assembled in lower-wage countries like Mexico. While he will not be be sworn into office until January 20, his words have already had tangible effects: Ford has canceled plans to invest €1.6 billion in Mexico.
This insecurity and absence of clarity is not positive for the US
Xavier Pujol, CEO Ficosa
Sernauto, just like the five car parts companies consulted for this story, strongly believes in the importance of NAFTA “because of the auto parts industry’s interests in those markets.”
A few days ago, Confebask openly used the word “concern.” The parent companies of car parts suppliers CIE Automotive, Gestamp and Mondragón Automoción are are all Basque-owned.
Undesired consequences
Mondragón’s automotive division has invested around €200 million in Mexico in recent years. Oskar Goitia, its vice-president, feels that “reversing this business dynamic with trade tariffs could result in undesired consequences.”
Meanwhile, the Catalan car parts maker Ficosa is waiting “for the situation to settle down.”
Xavier Pujol, the company CEO, says that “a protectionist policy by the new US administration could have an impact on our clients, and we believe that this insecurity and absence of clarity is not positive for the United States.”
Representatives for CIE Automotive, Gestamp and Grupo Antolín said it is still too early to comment on the effects of Trump’s threats.
English version by Susana Urra.
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