On the border: Foxconn in Mexico

Foxconn, the biggest electronic manufacturer worldwide, has strong assembly operations in Ciudad Juarez, on the Mexico-US border. With abundant migrant labor-force, extreme social violence and multinational production are among the main factors that characterize this operation.

Devi Sacchetto Martìn Cecchi
16 January 2015
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Foxconn's factory on the US-Mexico border. Photo supplied by author.

Ciudad Juarez is almost 2,000 kilometres from the state of Guerrero, where 43 Mexican students disappeared on September 26th. The violence perpetrated here by armed gangs and the police is no less severe, though, and close to 4,000 women have been killed since 1993. The numerous theories about these murders share one key element: the use of working-class women’s bodies as factors of production, whether on factory assembly lines or in drug trafficking and prostitution rings. Ciudad Juarez is a border town and its structure has changed markedly since the North American Free Trade Agreement, or NAFTA, was signed 20 years ago.

The production and social processes that have developed alongside the frontera are now in their “second generation” as far as the flow of goods and people and the construction of urban areas are concerned. Since the launch of NAFTA the border has been strengthened by a metal wall hundreds of kilometres long, separating two worlds with more in common than meets the eye. But this frontera is double-edged and packed with political significance. On the one hand it provides easy access for goods, but on the other hand it’s porous, allowing the various international migration mediators to shape the labour market by filtering the circulation of the work force.

Ciudad Juarez is an industrial city in the strictest sense of the term, with a mass of large factories woven into the urban fabric. Although there are 32 industrial parks devoted to manufacturing, most of the factories are not physically separated from the city area and are located alongside housing. After the wave of investments in the textile and automobile sectors in the 1980s and 1990s, electronics has now become the main production sector, employing 35% of the area’s 360,000 manufacturing workers according to official local government figures.

In the Ciudad Juarez area, which is classified as a special economic zone, businesses are exempt from paying taxes and VAT. In 2013 6,300 maquiladoras throughout Mexico were subject to this special tax regime. They employed 2.3 million people, with almost 90% working on assembly lines. Foxconn has been operating here since 2004 and has become the biggest electronics firm in Mexico. In 2011 the Taiwanese company’s exports were worth 8.6 billion dollars, 2% of Mexico’s total exports and second only to General Motors. The former Mexican ambassador to China, Sergio Ley, therefore found it easy to say, “Chinese firms need to internationalise and Mexico is the best platform in the world for doing it”.

Low wage levels, duty-free imports of raw and semi-finished materials, low energy costs, government tax breaks, wide availability of both skilled and unskilled labour and a very well organised ruling class with extremely weak union opposition are the main factors that have attracted dozens of multinationals. Leading global firms from the electronics sector, such as Philips, Epson, Toshiba and Flextronics have invested in this area, as well as companies manufacturing cars, rubber, pharmaceuticals and household appliances such as Ford, Delphi, Bosch, Goodyear, Johnson & Johnson and Electrolux.

The city’s geographical location at this central point between east and west allows multinationals to develop a global logistics strategy because they can use US ports in both the Atlantic (Houston) and the Pacific (Los Angeles). Its strategic position was strengthened in May 2014, when Union Pacific opened a massive logistics facility a year ahead of schedule. The Santa Teresa Intermodal Ramp is located on the US side of the border, cost 400 million dollars to build and has an annual lift capacity of 225,000 containers. The facility is situated approximately 30 kilometres west of the El Paso-Ciudad Juarez conurbation and is connected to Los Angeles by a railway over 1,200 kilometres long. It is the biggest logistics project along the US-Mexico border in recent years, ensuring rapid transportation of goods with an average journey time of 12 hours.

Foxconn’s new factory lies just across the border from the facility, in San Jerónimo. This is where the firm intends to move all its production, which is currently shared among three factories near Ciudad Juarez. The first of these, in the south-eastern part of the city, has a work force of around 2,500-3,000 and exclusively supplies Hewlett Packard. The second is in Las Torres, in the north-eastern zone, and its 13,000 employees mainly manufacture products for Cisco. The new factory is in San Jerónimo, 25 kilometres west of the city centre. It stands in a 240-hectare plot of land and its work force, currently numbering 6,000-6,500, manufactures products for Dell. Massive urban planning projects are in the pipeline to house the Foxconn labour force in the desert land surrounding this new factory. As one of the human resources managers explains, “Centralising production at this site will help the firm reduce costs because the economies of scale will cut prices related to transporting employees, canteen services and logistics.”

The labour force serving the maquiladora industry in Ciudad Juarez comes mainly from the Mexican states of Veracruz, Coahuila and Sinaloa, as well as from other parts of the state of Chihuahua. Even workers who were born here are often the sons and daughters of internal migrants with their own experiences of working in maquiladoras. Few migrants attempt to cross the border in this heavily militarised area. Migrants trying to enter the US illegally usually aim for areas in the east, which involve greater risk due to the isolated desert landscape. But Ciudad Juarez is one of the places where the US authorities send migrants without papers apprehended on US soil, irrespective of where they originally came from. These repatriated migrants join the pools of labourers without any possessions or social support networks. The options facing them are bleak: working in the maquiladoras for a low wage or joining one of the criminal gangs that now even post notices in the city’s main streets to recruit members. It’s a similar choice to the dilemma plaguing the young working-class people from the local area.

In Foxconn’s factories this young labour force assembles electronic products (computers, tablets, desktops, laptops) on production lines with very little technology except the odd electronic device to check that the finished products actually work. These lines are very flexible and can be modified depending on customers’ needs. Since tasks are dumbed down and no learning process is involved, workers are easy to replace. This interchangeability means that the firm can constantly move the work force from one task to another. It’s no surprise that the workers claim to “do a lot of things, depending on what day it is”. The manual and cognitive skills required may be elementary, but the level of intensity is exhausting. “It’s not hard to do what they ask but it’s very tiring standing all day on the assembly line doing the same task. Sometimes we have to work so fast we don’t even have time to go to the bathroom.”

The firm tightly controls the hours worked by its 22,000 or so employees depending on the flow of orders. Office staff, supervisors and managers are selected and recruited directly by the human resources department, but factory workers and assembly line leaders are hired through Cassem, a temporary work agency. Foxconn doesn’t award productivity bonuses and the workers’ speedy performance is the result of relentless monitoring by supervisors and team leaders. One worker said, “I’ve worked here for three years now but my wages have stayed the same. For two years our bosses have been telling us we’ll get a rise but nothing ever changes... Some of our bosses are real bullies, including the office staff. They always give you a hard time if you don’t stay late and work overtime, which is actually compulsory.” During periods of regular work the labour force operates on two 9.5-hour shifts. There are two breaks when workers can use the canteen, although one of them claims that “you usually only get rubbish” there. The shift pattern is designed to prevent employees from working excessive amounts of overtime, but shifts extend to 14 or 15 hours when deadlines are approaching. These drastic variations in working hours, without any legal mediation, make it impossible for workers to make arrangements outside work and cause a great deal of inconvenience, especially for mothers. “They keep changing our shifts... they don’t know anything about people’s needs, if they’ve got small children or not... and so they tell you, ‘Come earlier tomorrow’ or ‘You need to stay late today and work overtime’ and you have to do it.”

The tough Mexican factory regime calls for low wages, at least for manual workers. Their basic monthly pay is around 100 euros and only reaches 140 or 150 euros (2,500 pesos) if they work overtime. In Mexico the legal minimum wage varies between the northern states, including Ciudad Juarez, where workers earn 4 euros for eight hours during the day (or 7.5 hours at night), and the southern ones, where they earn 3.75 euros. As many as 6.5 million workers out of a working population of 50 million are stuck on the minimum wage.

The value of wages in Mexico relative to China has changed in recent years. At the end of the 1990s the average wage in Mexico was around four times higher than in China but nowadays the difference has been levelled out, if not reversed. The transformation of this relationship between wage levels is one of the factors determining the constant change in the geography of global production networks. The policy of low wages is closely monitored by the powerful Asociación de Maquiladoras (AMAC). AMAC ensures that its members all keep wages at the same level in an attempt to reduce both labour costs and worker turnover. However, as one worker explains, employees are constantly being replaced and Foxconn encourages the temporary work agency it uses to keep widening the recruitment pool. “We have about 100 people starting every week, but just as many people leaving. People come and go just like that. That’s why they’re always hiring, because people can’t handle it... Those who live far away leave work at half past six in the evening and get home at nine. There’s no point in them coming all this way to work because they waste so much time on the bus.” Journey times are one of the factors that force workers to move to a different factory. Many of them spend over two hours travelling to and from work and some spend as long as four hours per day. They travel on old decommissioned buses from the US which frequently break down, increasing journey times out of all proportion. “The bus often breaks down and people have to walk,” claims one worker.

The company’s location outside the city means that workers are dependent on the transport laid on by the firm, and so leaving the workplace is difficult. This is clearly a source of tension since the only strike recorded in Ciudad Juarez in recent years took place at Foxconn over this issue. On February 20th 2010 around 300 workers from the afternoon shift set fire to one of the canteens because the company was stopping buses from entering in order to force them to do overtime. The next day, under the pretext of a shortage of work, the temporary agency started laying off the striking workers in groups of 50 at a time. Within companies managers have free rein in negotiations with a work force that is individualised even further by the use of temporary work agencies. It’s no surprise, therefore, that one experience shared by workers is a strong sense of insecurity regarding the stability of their employment. This feeling of uncertainty is linked to the material and institutional conditions in which production takes place, starting with the extremely inadequate union presence. “We don’t have a union. When we went on strike they came to hand out leaflets... but the bosses didn’t let them in and we never saw them again,” one worker tells us.

After a significant drive towards unionisation supported also by non-governmental organisations during the 1990s, unions have essentially become marginalised. Between 2006 and 2012 members of criminal gangs weren’t the only casualties of the so-called “war on drugs” sponsored by the Mexican federal government and supported by the US authorities. Dozens of social activists, journalists and other militants campaigning to protect the rights of workers, women and marginalised groups of the population also lost their lives. The weakening of trade union organisations and civil society was partly responsible for the consolidation of second-generation maquiladoras owned by multinational firms. Workers do not seem willing to sit back and accept the multinationals’ ability to keep factories free from unions, though, and are aware that battle may once again be about to recommence.

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