Pentagon Urges Mexico
to Reopen
APRIL 20, 2020
A surprising number of
America’s defense manufacturers rely on parts made south of the border.
The continued flow of
various weapons to the Pentagon during the
pandemic will depend to a surprising degree in Mexico, the U.S. neighbor frequently criticized by President Trump.
Many U.S. defense
firms, particularly aircraft manufacturers, rely on Mexican suppliers, many of
who have closed or slowed operations during the pandemic, said Ellen Lord,
defense undersecretary for acquisition and sustainment.
“I think one of the keys
things we have found out are some international dependencies,” Lord said Monday
during a press conference at the Pentagon. “Mexico right now is somewhat
problematical for us but we’re working through our embassy, and then there are
pockets in India, as well.”
After discussing the supply
problem with Christopher Landau, the U.S. ambassador to Mexico, last
week, Lord said she would write Mexican Foreign Secretary Marcelo Ebrard “to
ask for help to reopen international suppliers” in Mexico.
“We are seeing an impact on
the industrial base by several pockets of closure internationally,”
she said.
The Pentagon’s supply-chain
dependence on Mexico has grown over the past decade as defense firms large and
small outsourced production.
“U.S. and foreign
aerospace component suppliers have been increasingly locating production
facilities in Mexico,” the United States International Trade Commission said in
a 2013 report. “Lower manufacturing costs (largely due to a lower wage structure), proximity
to original equipment manufacturers (OEMs) in the United States, duty-free
access to other important aerospace markets, and a Bilateral Aviation Safety
Agreement (BASA) with the United States all contribute to Mexico’s greater
appeal compared with other global manufacturing locations.”
The report signaled out
Lockheed Martin, Textron, General Dynamics, General Electric, Honeywell,
Rockwell Collins (now Raytheon Technologies), as operating subsidiaries
in Mexico.
Lockheed uses the electrical wiring in its Black Hawk and S-92 helicopters and F-16 fighter jets made
by French firm Safran in Chihuahua, Mexico. Safran touts itself as Mexico’s largest aerospace employer, with about 13,000 employees.
In 2012, Boeing held an
event encouraging suppliers to do more business in Mexico; today it relies on PCC Aerostructures
in Monterrey, Mexico. Textron, on its website, touts manufacturing work in Mexico.
If Mexican plants remain
closed, it could further disrupt U.S. firms’ deliveries of Pentagon
orders. While there have been some coronavirus-related disruptions over the
past two months, many U.S. defense firms have continued building
weapons, albeit at a slower pace.
“Right now, we’re, I think,
a little bit living on the benefit of on-hand stock,” James “Hondo” Geurts, the
head of Navy acquisition said on a call with reporters
last week. “At some point that
on-hand stock if the downstream production supply isn’t being generated, that
will start running out.”
In March, the Pentagon
deemed defense contractors essential to the
national security workforce, which
helped weapons makers at factories and offices amid local and state-wide
work-from-home orders.
In recent weeks, Boeing had
been forced to stop military manufacturing in Washington state and
Pennsylvania. Seattle-area factories resumed limited work last week while
Philadelphia did the same on Monday.
Marcus Weisgerber is the global business editor for
Defense One, where he writes about the intersection of business and national
security. He has been covering defense and national security issues for more
than a decade, previously as Pentagon correspondent for Defense News and chief
editor of ... FULL BIO
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