Overseas Parts Suppliers To The U.S. Auto Industry Are Changing Their Supply Chains To Build Factories in The United States

Hota Industrial Mfg, a parts supplier to major automakers such as Tesla, Ford and General Motors, is already preparing to build its first U.S. plant. The company's current plant is mainly located in Taiwan, China, producing gears, rotor motor shafts and other automotive parts. And because buyers are mainly concentrated in North America, the region accounts for 70% of its sales. To address customer concerns about supply chain security, the company in September announced a $99 million investment to build a factory in New Mexico, its first outside Asia. "It was actually a very natural decision for us to choose the U.S.," Shen Qianci, the chief executive of Heda, said in an interview. During the pandemic, a shortage of cargo containers and port workers and big industry turned to expensive air freight to ship heavy auto parts to buyers in North America. Shen Qianci pointed out, "During the epidemic, even if your product is cheap, the delivery is also a problem. So now, people are starting to accept the idea that 'if you're closer to me, I'll pay a little more.'" In addition, Shen Qianci said that the US factory is to address the concerns of its customers in the supply chain. The "next Detroit" and Big Industries' new factory in the United States will be located in New Mexico, not far from both Texas, where Tesla is headquartered, and Mexico. Construction of the auto parts plant will begin early next year and mass production will begin in 2025. Both the United States and Mexico are speeding up their electric vehicle supply chains, with Tesla already planning to build a gigafactory in Mexico. "It's going to be the next Detroit," he said of the U.S.-Mexico border. Shen Qianci pointed out that in the first few years after the plant began operations, the United States