Image credits: Raul Morales
News Article

Mexican Vehicles Production to Increase by 16 Percent: INA

By Rodrigo Andrade | Thu, 06/30/2022 - 16:12

During the EXPOMAQ 2022, the association for the National Auto Parts Industry (INA) stated that the vehicle production in Mexico is forecasted to reach 3.47 million units in 2022. Despite the challenges faced by the automotive industry in the past two years, the latest data gathered by the National Institute of Statistics and Geography (INEGI) shows a slow but steady recovery of vehicle production in Mexico. 

INEGI’s forecasts a 16.53 percent recovery in vehicle production in comparison to 2021. The 3.47 million forecasted vehicles represent 68 percent of the installed production capacity in Mexico, as the country has a total capacity to produce over 5.32 million units. However, this depends on many external factors such as raw material and microchip availability and vehicle demand. 

“The first [factor affecting manufacture] is the closed production of the supply chain and microchips. Second are transportation and the closure of ports for departure and arrival such as at Long Beach, where there were disruption issues. It seems incredible, but we have 21st century trade with 20th century production and 19thcentury laws. The third is the war in Ukraine, which increases the supply problem for raw materials such as palladium and neon,” said Francisco González Díaz, President, INA.

While production levels have risen at a steady pace, the numbers are still far from the 3.8 million vehicles assembled during 2019, before the COVID-19 pandemic. It is estimated that this level of production could resume by 2025, according to Statista. The automotive industry is critical to the Mexican economy as “in the growth projections of the global economy, we see all the possibilities for the automotive sector. In the world ranking of FDI inflows, Mexico still has a privileged position as investments have entered the automotive sector and also other industries,” said González, as reported by MBN. 

Toyota, Ford and General Motors (GM) are some of the OEMs to increase production in 2022, with GM reporting an increase of almost 50 percent while Ford is increasing manufacture due to the international demand for the Ford Maverick, Bronco and Mustang Mach-E. Toyota faces a similar situation with one of its most sold vehicles: the Tacoma. 

JAC Mexico is currently breaking its own production record with a growth of 285 percent, while Audi has shifted production to Mexico and is working at 110 percent of its installed capacity. Other assemblers have estimated production recovery levels of between 4 percent and 20 percent, according to INEGI. 

Photo by:   Raul Morales
Rodrigo Andrade Rodrigo Andrade Junior Journalist & Industry Analyst