Automotive Exports Drop 10% in April

Mexico’s automotive exports slowed down in April 2023, due to the uncertainty of a possible recession period in the US that would affect the manufacturing sector. During this month, automotive exports totaled US$13.3 billion, their lowest level since July, 2022. 

"Automotive exports declined given a potential recession in the US. When people are uncertain about the future, they tend to avoid long-term expenses. A similar situation is taking over the US real estate sector, while remittances are also likely to decrease,” explained Miguel González, Coordinator, Center for Financial and Public Finance Studies (CEFI), UNAM. 

According to data from INEGI, in April, automotive exports tailed off by 10.79%, which represented a decrease of 3.6% over the same period last year. The share of automotive exports sent to the US accounted for 26.52% of the total exports sent to that country. Overall, Mexican exports fell 2.85%, reaching gains for US$46.2 billion, which represents the lowest figure since February, 2022. Oil exports decreased 32.8%, non-oil exports tumbled 0.2% and manufacturing shipments fell 0.4%. 

Specialists pointed out that the weakness in global economics has affected external demand and inflation. "This situation is worrying because it appears at a time when failures in the value chains have already been addressed and, therefore, could be connected to the weakness that permeates the global economy, especially in the industrial sectors," stressed Marcos Arias, Analyst, Monex Financial Group.

In 2022, Mexico's automotive exports reached US$165.2 billion, with an annual increase of 18.2%, the highest growth rate in the last decade. Moreover, 83% of the exports went to the US market which represented a 17.3% growth rate in comparison to 2021.