El Bajio Attracting More Auto Parts Investment

El Bajio Attracting More Auto Parts Investment

Mexican auto parts production is moving forward driven by the states in the El Bajio region. Last year Guanajuato, Queretaro, Aguascalientes, San Luis Potosi and Jalisco accounted for 31.2 percent of the auto-parts market, recording a two-point growth over last year, according to the National Auto Part Industry (INA). Guanajuato consolidated its position as the jewel of the region with growth from 8.9 percent in 2018 to 10.2 percent in 2019.

Once again, the Bajio’s privileged location - with direct land access to the US and to both oceans - paid off for the Mexican auto parts industry. “The geographical position of the Bajio states is attracting more auto parts manufacturing companies”, INA’s Foreign Trade Director Alberto Bustamante said.

The benefits for importers and exporters are considerable. For example, it only takes four hours to reach Nuevo Laredo customs from San Luis Potosi along Mexico’s main auto parts export route.

Most of the components needed in Jalisco and Guanajuato are imported from Asia and arrive into the country via the Manzanillo port on the Pacific coast, which is also used to export auto parts. The Veracruz port on Mexico’s Atlantic coast is used for European exports, Bustamante explained.

Despite Mexican states on the US border accounting for 50.7 percent of national auto part production, in the years to come the Bajio states will increase their market share, consolidating the automotive industry and above all bringing future investments, Bustamante predicted.

According to INA, the auto-parts industry in Mexico is expected to exceed US$102 billion (approx. MX$1.89 trillion) in production value by 2020. However, the impact on Mexican automakers of the recently approved USMCA trade treaty is still being debated.