Mexican workers. French employer. Texas landlord. American trucks.
At manager Armando Cadena’s factory near the U.S. border, the brake lights his workers build are a result of the globalization – and job exports –President Donald Trump so dislikes. But this plant is also part of the big bet by U.S. automakers to keep their factories in the Midwest competitive and car prices low. That bet could take a hit Tuesday, when the president’s 25% tariff on Mexican imports goes into effect – unless there is a last-minute deal.
“It’s going to have a huge impact,” Cadena said. “At the end of the day, it’s the consumer, you or me, who are going to pay the tariff.” The president has promised to slap tariffs on countries he says aren’t playing fair with the United States. A tariff is a tax on imported goods, the cost of which is typically passed on to consumers.
Trump said in a news conference earlier this week that “the tariffs are going forward on time, on schedule.” But Cadena’s plant, less than a mile from the U.S.-Mexico border, can’t be quickly untangled from its spot in the global supply chain.
The factory building is leased by El Paso, Texas-based Tecma Group. A company called Lacroix, headquartered in western France, owns the production lines. With U.S. and Chinese components, Mexican workers build the products: brake lights and control panels destined for General Motors, Ford, Stellantis and Toyota vehicles. “It’s the system that has made it possible for virtually all Americans to have a smart phone and given us cars that are dramatically better than cars built 40 years ago,” said Cullum Clark, director of the Dallas-based Bush Institute-SMU Economic Growth Initiative. “It works.”
At the end of the production line on a Friday afternoon in mid-February, Cadena inspected LED taillights glowing white, then red, in a quality testing machine.