Producing Inequalities and Transnational Automakers. Case Study: Audi in San Jose Chiapa, Puebla Mexico.

In Mexico, government and public policy makers have given preference to certain industries, their promotion through subsidies, tax exemptions, laws that favor the production and sale of their goods, preparation of human resources, specialized research centers etc. This arguing that they are generating high value added (since in these industries, the use and production of high-tech goods is inserted), and suppose that produce economic and technological spillovers, this means that investments in machinery and hiring will be utilized in companies and population neighboring in the region where conducted the initial investments. Spillovers are assumed to positively impact the levels of training and qualification of the workforce and their purchasing power, also affecting the learning capacities of local and national companies, thus improving their competitive position.

However, it shows that the expected improvements are the exception, not the rule, and that there are inequalities in employment where high casualization of labor (subcontracting for example) occurs in industries at least in Mexico favored by policy, which is dominated by foreign-owned enterprises, which by their nature are global; in addition to the inclusion of these companies in regional areas do not have the expected spillovers. In this sense, the paper reconstructs the debate on the effects of such investments through the case of the installation of a plant of the automaker AUDI, in a community in Puebla, Mexico. Community with tradition in agricultural and agro-industry, and which the population has a low educational level. Given these characteristics of the population opportunities to labor within the first links in the chain are unlikely.

Installation of the plant requires a change in land use, from agriculture to automotive industry and housing construction for  the workforce who do work in the new plant and auto-parts supplier  (the arrival of more than 30,000 workers are expected in the region). As the production capacity of the region will be lost and with it the ways of obtaining their income and livelihood, it will change their lives profoundly.

This paper analyzes and explores three possible inequalities to be presented for the case of AUDI in this community:

a) Economic inequality between workers in the same industry (automotive assembly- suppliers)

b) Economic inequality between workers of industry and population of the community where it will be located.

c) Technological inequality between the automotive assembly and national companies.

For this one, we consider the strategies followed by the company AUDI AG, with regard to its relationship with suppliers in the economic and technological sense. Also, we collect information about the region socioeconomic aspects, and interviews with residents.