Ford Motor Co <F.N> may have to shut some U.S. car plants as early as next week if they fail to receive engines produced in Mexico’s Chihuahua state, Christopher Landau, the U.S. ambassador to Mexico, said on Thursday.
Mexico is a key part of a wider international supply chain crucial to U.S. carmakers, many of which operate factories across the border in Mexico due to lower labor costs.
Landau said a senior Ford executive told him on Wednesday night the Dearborn, Michigan-based automaker was concerned about the engines produced in Chihuahua state, where the governor has “limited industrial capacity to 50%” due to the coronavirus.
The federal government has given automakers, mining firms and builders, with activities deemed essential, the green light to restart work in Mexico, though some states have implemented their own restrictions as the coronavirus pandemic rages on.
“They’re saying that they’re going to start shutting down factories in the United States as of next week if they don’t get that rolling,” said Landau, in a talk organized by the Atlantic Council.
Ford had no immediate comment on the matter.
In May, when Mexico signaled it would delay the reopening of its factories, Mexico officials said their U.S. counterparts pushed for a speedy return, arguing that U.S. plants on American soil could not operate without them.
(Reporting by Anthony Esposito in Mexico City; Additional reporting by Ben Klayman in Detroit; Editing by Drazen Jorgic and Tom Brown)
