Title: Mexican competitive advantage in NAFTA: a case of social dumping? A view from the automotive industry

Authors: Alex Covarrubias Valdenebro

Addresses: College of Sonora, Av. Obregon 54, CP 83000, Hermosillo, Son, Mexico

Abstract: In the midst of the NAFTA renegotiations, the Mexican Automotive Industry (MAI) has drawn much attention. Gaining a progressive share of markets, jobs and portfolio investments within the region and accounting for the entire US trade deficit, the MAI is one of the most critical pieces in the way of a new NAFTA. In addition, the US President, Donald Trump, has criticised it as an example of the shortcomings of the old agreement. These facts call for a better assessment of the MAI's sources of competitive advantage. This paper builds on business cycle theories and socio-economic perspectives of market embedded institutions to provide an additional lens with which to study the MAI and NAFTA. It presents theory and evidence to demonstrate that the MAI position rests on social dumping policies that underpin illegitimate sources of competitive advantage. It then discusses the issues at stake in the current NAFTA renegotiations.

Keywords: NAFTA; automotive industry; labour; social dumping; renegotiations; Trump administration.

DOI: 10.1504/IJATM.2020.110402

International Journal of Automotive Technology and Management, 2020 Vol.20 No.3, pp.239 - 257

Received: 12 Apr 2019
Accepted: 10 Oct 2019
Published online: 19 Oct 2020 *

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