TOKYO – UMC Electronics is closing production at its electronics manufacturing factory in Mexico and winding down its business operations in North America, a reaction to the slowing automotive market. The EMS company, annually ranked in the Top 20 in the CIRCUITS ASSEMBLY Top 50, said it began efforts to dissolve and liquidate the operations in Lagos de Moreno, Jalisco, in April. The target date for completion is September.

“With this decision, the company will curb future losses and focus on rebuilding our business performance.”

The unit had net sales of 4.15 million yen in the year ended March 2020 and a loss of 3.87 million yen.

UMC established the Mexico subsidiary in May 2016 in anticipation of capturing demand from automotive customers for the US market. It said that although the company “had been trying to improve the financial base by increasing capital, the deficit has continued since the establishment, and the debt has become insolvent in the fiscal year ending March 2020. The company has determined that it will be difficult for UMC Mexico to improve its profits, in the process of promoting structural reforms. For these reasons, the company has determined that the dissolution of UMC Mexico and UMC North America and the shift of management resources to other bases is the most appropriate for the group's early recovery of business performance.”

UMC will also shutter its North America sales subsidiary.

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