The management of a labor strike in an international operations arena

This case study explores in detail the circumstances surrounding a labor strike in a maquiladora (production sharing) industry in Juarez, Mexico. ABC Consumer Electronics is headquartered in the U.S. with major operations in Mexico. During the Mexican peso devaluation and economic crisis of late 1994, the company faced the greatest labor problem of its long history. The workers' purchasing power was reduced to nearly one-half of its value before the crisis. Other underlying and unaddressed problems at ABC were brought to surface by workers who found themselves incapable of providing the basic necessities of life for themselves and their families. This paper explores the manner by which ABC handled the strike, how the strike affected ABC's operations and strategies, and the impact of ABC's decisions on other maquiladoras in Juarez, Mexico are fully explained and delineated.