Eaton Corp. says to move auto parts plant to Mexico

MEXICO CITY, Oct 1 Reuters reported that industrial products manufacturer Eaton Corp. <ETN.N> said on Tuesday it was moving its Mooresville, North Carolina, transmission hoses and power steering parts plant to the central Mexico city of Queretaro due to lower production costs in Mexico.

The Cleveland, Ohio-based firm said it would close the North Carolina plant, which employs 317 workers, in the first quarter next year.

"We've been asked by our customers, the automotive manufacturers, every year, to reduce our prices and we just can't be competitive in North Carolina. The cost structure is much better in Mexico," Eaton spokeswoman Dawn Hanson told Reuters.

Hanson said Eaton, which has closed 19 plants since 2001 due to the economic slowdown in the United States, would hire 200 employees for the new plant in Queretaro.

Eaton already has six plants in Mexico manufacturing auto parts for the U.S. market, and employs some 2,400 people in this country.

Mexico is the biggest auto parts maker in Latin America and the 10th biggest auto assembler in the world. Most of the world's big automakers have assembly plants here, attracted by Mexico's many trade pacts with countries around the world, and relatively cheap cost of labor.