German automotive supplier Continental AG recently announced it will close an auto parts factory along the U.S.-Mexico border by 2024 as part of a restructuring plan.
The plant employs 2,000 workers and makes electronic parts used in vehicles manufactured by Chrysler, General Motors, Ford, Nissan, Kia, Mercedes-Benz, Hyundai and BMW.
“Unfortunately, the news is going to be tough for us here in Nogales with the departure of Continental,” said Joshua Rubin, vice president of Javid, a shelter company that facilitates foreign companies setting up production in Nogales, Mexico.
The Continental facility is part of the maquiladoras industry in Nogales, which has 105 maquilas employing 45,000 workers. Maquiladoras are foreign-owned assembly plants in Mexico that import machinery and materials and export finished products around the world.
Those companies may help fill the gap left by Continental, according to Rubin.
“This hit will hurt the city also. However, we are seeing a raise in interest in Mexico again and have a good feeling we will be needing more employees by 2024. I think all and more will all be re-employed fairly quickly,” Rubin said.
The Nogales factory, which opened around 2006, produces vehicle communication and connectivity technology and drive system components.