Once the backlot for the automobile industry, specializing in antiquated models, Auto manufacturing in Mexico has morphed over the past several years into one of the most sophisticated and thriving passenger vehicle production hubs in the world.

 

Growth Factors

Auto manufacturing in Mexico has a lot to offer producers in general, especially to OEM assemblers. Low wages certainly contribute to the equation, with Mexican workers making a fifth what their counterparts in the US make. And this is not low-skill or low-quality work. According to leading carmakers around the world, the product turned out by Mexican factories is on par with even German manufacturing when it comes to quality and sophistication. Add to this mix the primary draw for foreign auto investment: trade agreements with over 40 markets worldwide, including the EU, US, and Asian countries. It’s not hard to see why so many leading auto makers are doing business south of the border.

Track Record of Growth

The dynamic and mature growth of Auto manufacturing in Mexico in recent years is undeniable, as the following information demonstrates:

  • Light vehicle production in Mexico reached 3 million vehicles in 2014.
  • Light vehicle production is projected to reach 5 million in just five years.
  • This year, Mexico is the 7th largest producer of light vehicles in the world – up from 9th just a few years ago.
  • Mexico is also the 6th largest producer of heavy vehicles in the world.
  • Approximately 50 different models are currently based in Mexico.
  • Mexico is the 8th largest automotive component exporter in the world.
  • In 2012, the automotive sector accounted for over 20% of the country’s total foreign direct investment.

Automotive Plants

The proof is in the pudding, and the ultimate arbiter of Mexico’s global competitiveness in the automotive industry would have to be the big OEM carmakers of the world. Their many votes for Auto manufacturing in Mexico are found in the form of new production facilities scattered all over the country. In light vehicles alone, Mexico hosts eighteen production facilities in eleven Mexican states. Some of the leading automotive investors with a sizable presence in the nation include:

  • General Motors
  • Chrysler
  • Honda
  • BMW
  • Toyota
  • Volvo
  • Mercedes-Benz
  • Daimler
  • Ford
  • Volkswagen
  • Nissan
  • Mazda

Since 2010, automakers have announced over $24 billion in new investment in Auto manufacturing in Mexico. This represents nearly a third of all new spending on North American factories. And, based on current plans and trends, it is estimated that the new factories built in the decade between 2008 and 2019 will outnumber those built in the previous four decades combined.