Japan's Jtekt delays Mexico auto parts expansion plan pending NAFTA (updated)
10/07/2018 04:37
(Adds details, Jtekt president's quote, background)
NAGOYA, July 10 (Reuters) - Japanese auto components
supplier Jtekt Corp 6473.T said it was holding off on
expanding production in Mexico, awaiting the outcome of talks
over the North American Free Trade Agreement, known as NAFTA.
Japan's auto industry has been plagued by uncertainty since
U.S. President Donald Trump last year launched a renegotiation
of NAFTA, seeking to repatriate manufacturing jobs to the United
States. Automobiles and auto parts are key export products for
the country.
Jtekt President Tetsuo Agata said prospective automaker
clients were waiting for the outcome of the talks before making
new decisions on their Mexico operations.
"They are watching the NAFTA situation carefully. So we also
have to hold off on new production plans," he told reporters at
its Nagoya headquarters.
Jtekt is a Toyota Motor Corp 7203.T group supplier that
manufactures vehicle steering systems for the automaker and
other customers. It operates a plant in San Luis Potosí state in
Mexico.
Jtekt also operates more than 10 plants in the United
States, mainly in Tennessee, South Carolina and Texas.
Most of Japan's major automakers and suppliers operate
plants in the United States. Top producers Toyota, Nissan Motor
Co 7201.T and Honda Motor Co 7267.T locally produce about 50
percent to 70 percent of all vehicles sold in the country.
They also operate plants in Mexico and Canada, exporting a
portion of the output from those plants, along with some
vehicles made in other countries, to the United States.
In addition to uncertainties surrounding NAFTA talks,
Japanese automakers have also been rankled by Washington's move
in May to launch a national security investigation into car and
truck imports to the country which could lead to new tariffs.
Japan's automobile lobby has criticised any regulations
which could raise costs for Japanese automakers doing business
in the United States, the world's No. 2 auto market.
urn:newsml:reuters.com:*:nL3N1SP4AX
(Reporting by Naomi Tajitsu; Editing by Muralikumar
Anantharaman and Gopakumar Warrier)
((Ritsuko.Ando@reuters.com; +81 3 6441 1743; Reuters Messaging:
ritsuko.ando.thomsonreuters.com@reuters.net))