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Plastics firms in Ciudad Juárez deal with rising crime

CIUDAD JUÁREZ, MEXICO (Nov. 25, 9:30 a.m. ET) -- Rafael García runs a Mexican restaurant in El Paso, Texas, across the border from a city with one of the world’s highest murder rates.

He used to own a company in Juárez that manufactured injection molded parts for vacuum cleaners, until he was kidnapped. After being released he fled across the border and opened Agavero’s, a restaurant on El Paso’s main North Mesa Street.

“I’ve lived all my life in Juárez,” he told Plastics News by telephone. “But I haven’t been back for three months.”

Through Nov. 12, the Associated Press counted 1,986 homicides in Juárez in 2009, mostly related to violence between rival drug cartels. In 2008 there were 1,600 murders.

Some business people on the U.S. side of the border are so fearful of falling foul of Juárez’s criminals that they make excuses for not visiting the city of 1.5 million, even when requested to do so by clients.

“We have customers [in Ciudad Juárez] who ask us to visit them and we make plans to work around it,” said Joe Gardea, head of sales and purchasing for Border Hose & Supply Company Inc. in El Paso, which sells, among other products, PVC hoses and tubing.

“We’re very leery about who is calling [on the telephone] and that sort of thing.” The violence, he said “has taken its toll on our business. Everybody on both sides of the border is hurting.”

Asked if he could see an improvement in the short term, Gardea replied: “No. We’re talking maybe five or 10 years.”

The plastics industry plays an important part in Juárez’s economy. According to Enrique Miramontes, who represents Baltimore-based equipment supplier Novatec Inc. in Juárez, West Texas and New Mexico, Juárez has about 90 injection molders, 15 extruders and one or two blow molders. It is a major maquiladora hub for automotive industry suppliers of such components as wire harnesses, seat belts and steering wheels. Many suppliers also serve appliance manufacturers such as Electrolux from plants in Juárez.

In a message posted on the El Paso Regional Economic Development Corporation’s Web site in June, Bob Cook, the organization’s chairman, wrote that “at present, there are upwards of 360 maquila [manufacturing] operations in Juárez, about 85 percent of which are owned by U.S. corporations, employing more than 220,000 persons.”

“There has been much written about the 1,600 homicides that occurred last year in our sister city,” Cook wrote, referring to Ciudad Juárez, “but the reality of the situation is far different from what is generally reported in the media. More than 98 percent of these homicides were perpetrated against drug cartel members, police, and military personnel.”

The civilian population was largely unaffected because “the vast majority of violent crime has been in specific geographic areas of Juárez — most of it well away from our modern industrial parks, where more than 80 percent of the expatriate manufacturing and distribution business is conducted.

“In spite of the spike in violent activity, we continue to see economic growth in our region,” he said.

Miramontes believes criminal activity has had far less of an effect on the local plastics industry than the global economic downturn.

In the first few months of the year, manufacturing in the city dropped to below 30 percent of capacity, he said. “Now it’s back up to 75 percent. The violence is not a big factor” in the downturn, he said.

He added that “it is a factor, because you want the workers to feel comfortable, but it’s not a big one.”

Hector Nuñez, owner of 9-year-old injection molder Injectoplastics SA de CV of Juárez, said there are “fewer clients, less work and fewer opportunities.” But he blamed violence for a fraction of the downturn.

Companies take precautions, he said, and people continue to work. “When work is over for the day, people go out less in the afternoons and evenings but as far as work is concerned we’ve not had any problem” [with the violence].

Nuñez would like to see tougher action taken by Mexican authorities against the drug cartels, a sentiment echoed by some of Ciudad Juárez’s business leaders.

In mid November they said they will request the Mexican government and the Inter American Human Rights Commission to ask the United Nations to send peacekeepers to the city, which is already patrolled by 5,000 Mexican troops.

“We have 55 employees and we’re optimistic about 2010. We believe there will be more opportunities,” Nuñez said.

Celarent Sánchez, Injectoplastics’ plant manager, said despite narcotics-related violence, Ciudad Juárez continues to be “very important” for many North American manufacturers because of its geographical location.

“The automotive industry has been reactivated and we’re beginning to get a lot of work again from that sector,” he said, adding that the global economic downturn has persuaded companies to turn their attention away from China and to focus on Mexico.

Injectoplastics has 20 presses, ranging in size from 85-700 tons.

Mr Smith: Thank you for your comment. I don't have the figure you've requested to hand. What I do know is that whenever there's violence on this scale the violence inevitably spills over and affects the civilian population not involved in the war on illegal drugs trafficking. Since the article was published I've heard about the murder of two teenagers (known to my family) who dared to go to the aid of a young woman who was being mistreated outside a discotheque.

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More than 98 percent of these homicides were perpetrated against drug cartel members, police, and military personnel.” What is the actual percentage of military and police, excluding drug cartel members? What's wrong with this picture?

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