San Ysidro Crossing – Photo by the US Customs and Border Protection, taken by Mani Albrecht

In 2018, Mexico became the sixth-largest automotive producer worldwide and the country is still winding up. According to Eduardo Solís, President of AMIA, Mexico could reach fifth position by 2021. Chinese vehicle production in Mexico, the arrival of BMW and Mercedes-Benz to the country and a growing demand in the US are all factors fueling growth. This week, several automotive production milestones were reached and new investments were announced. As Honda celebrated reaching the 1 million mark in transmission production at its Celaya plant, MAN Truck & Bus added a new assembly line at its Queretaro Facility and Grupo Cuprum vowed to invest US$30 million to produce automotive aluminum components.

There are, however, some issues to be solved in terms of foreign trade and the domestic market. USMCA could become a political hostage in the US, Canada and Mexico if it is not ratified in 2019. Meanwhile, partial closings of the US-Mexico border by the US government have pushed Mexico-based auto parts producers to find new ways to deliver their components on time, including costly air transportation. On Friday, Minister of Economy Graciela Márquez Colín met with US Trade Representative Wilbur Ross to discuss several pressing trade matters.

Rev your engine, this is the week in automotive!

Solid Production Prospective

According to AMIA, Mexico is on its way to becoming the fifth-largest vehicle producer worldwide in two years.

MAN Truck & Bus added a new production line to its Queretaro assembly plant that will produce chassis for medium and long-range buses.

Transportation equipment is the most important sector for Queretaro’s exports.

Honda celebrated the production of its 1 millionth transmission at its Celaya plant.

Visteon will install a new design center in Queretaro. The company will shift its hardware engineering support operations from Chihuahua to Queretaro to centralize everything at a single venue.

Grupo Cuprum will invest US$30 million in 2019 to produce aluminum automotive components for the Mexican automotive industry.

Gray Skies for Automotive Trade

USMCA may not be ratified in 2019. According to Andrés Rozental, former Undersecretary for North America at Mexico’s Ministry of Foreign Affairs, the agreement could be hostage to electoral politics.

Due to partial closings at the US-Mexico border, INA and its members are considering to transport auto parts by air to prevent delayed deliveries.

On Friday, Minister of Economy Graciela Márquez Colín met with US Trade Representative Wilbur Ross to discuss USMCA, tariffs and business opportunities.

Mexico’s vehicle exports increased 1.35 percent in February 2019, which was the lowest growth rate in 29 months.

An Ever-contracting Market

The new president of Honda Mexico, Kazuhiro Takizawa, highlighted the company trusts Mexico’s vehicle market will recover.

Vehicle financing has reached 21 consecutive months of setbacks after contracting five percent in February, according to data of AMDA.

Mitsubishi, Volkswagen and Chevrolet are the brands that offer the least satisfaction to Mexican car buyers, according to JD Power.

Don’t forget to follow us on twitter at @mexautomotive and @mexautomotriz for the latest industry news.

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