INTERNATIONAL SUPPLY CHAIN

Since the signing of NAFTA in 1993, North American automotive OEMs have moved final assembly and other manufacturing operations from domestic locations to international locations. Mexico provides a relatively inexpensive labor force and is within geographic proximity of the US. Tier One suppliers have also relocated some operations to Mexico, such as American Axle & Manufacturing (AAM) and its Guanajuato Gear & Axle (GGA) facility, where this study was performed. While the proportion of GGA's inbound material sourced in Mexico has increased, this still represents a small fraction of GGA's supply base. Numerous efforts have been made at localization of suppliers to Mexico, both through existing suppliers relocating and the development of Mexico-based suppliers. For the suppliers remaining in the US and Canada, there are numerous possible transportation solutions, including FTL, stacktrain, LTL, and milkruns