As it prepares to construct electric vehicles in the border state of Coahuila in 2023, General Motors Co (GM.N) announced on Thursday, that it will invest $1 billion in a manufacturing complex in Mexico, drawing immediate criticism from the United Auto Workers union.
GM has announced the construction of a new high-tech paint shop at the Ramos Arizpe plant, which currently assembles traditional internal-combustion cars, such as the Chevrolet Equinox and Blazer models, as well as engines and transmissions.
As Washington considers major new incentives for electric vehicles, the United Auto Workers opposed GM’s decision to create EVs in Mexico, rather than using the union’s representatives in the United States.
“At a time when GM is asking the US government to invest significantly in subsidising electric vehicles, this is a slap in the face for not only UAW members and their families, but also for US taxpayers and the American workforce,” said UAW Vice President Terry Dittes in a statement.
In response to the UAW’s comment, GM said that it has “recently announced nearly 9,000 jobs and over $9 billion in new electric vehicle or battery cell manufacturing facilities in Michigan, Ohio, and Tennessee.”
The White House did not immediately respond to a request for comment, but President Joe Biden has called for $174 billion to increase electric vehicle production, sales, and infrastructure in the United States.
“There’s no reason why American workers can’t lead the world in the manufacture of electric vehicles and batteries,” Biden told the US lawmakers on Wednesday.
When asked, GM presented an English translation of a news release about the Mexican investment, that was only available in Spanish on its website.
GM also plans to manufacture batteries and electrical components at Ramos Arizpe, as well as make other changes to the facility.
GM did not say when it started construction on its new paint store, but its Mexican activities were previously criticised by former President Donald Trump. Trump had threatened to impose tariffs on GM vehicles coming from Mexico.
According to Sam Fiorani, who monitors potential vehicle development for AutoForecast Solutions, GM plans to start producing two Chevrolet electric SUVs in Ramos Arizpe in 2023.
According to a GM spokesperson, the company is not announcing or verifying the electric vehicles, that will be installed in Coahuila, and Fiorani’s statement is merely speculation.
Electric vehicles are already produced at four locations in the United States and Canada by the automaker. GM has stated that it plans to stop selling gasoline-powered passenger vehicles in the United States by 2035.
The expansion of GM’s Ramos Arizpe plant will include new capacity for the production of batteries and other electronic components, which will begin in the second half of this year, according to the company.
During a webcast announcement, Francisco Garza, president of GM’s Mexican unit, said, “I’m confident this investment will contribute to continue boosting Mexican manufacturing while bringing development to the region, the industry, and the world.”
Garza said he couldn’t rule out adding a third output change to the Ramos Arizpe plant in the near future, but that it would be contingent on certain economic conditions being met.
The existing workforce at the plant totals 5,600 direct workers.
