Mexico, US Could Lead Electromobility Transition

US Ambassador to Mexico Ken Salazar made a statement yesterday recognizing the opportunity Mexico and the US have to collaborate in leading the region’s transition towards clean energy, with the automotive sector being an example. At Salazar’s request, the Mexican Association of the Automotive Industry (AMIA) published the “Transition to Electromobility in Mexico” report analyzing the present and future of EVs and hybrid models in the country.

“We support AMIA’s efforts to facilitate the transition of Mexico’s vehicle fleet to electric-based cars that would eventually replace internal combustion engine (ICE) vehicles to fulfill our shared goal of a brilliant future for the North American region,” said Salazar.

According to the report, technologies and solutions from the automotive industry are already a reality and alternative to ICE vehicles, which continue to dominate the market. However, increased federal leadership in the form of fiscal manufacturing incentives and public policies for increased accessibility are still needed for a faster transition to electromobility.

“The automotive industry has the compromise of bringing the best technologies to contribute to the solution of these issues and, in cooperation with the government, has taken on the challenge of promoting public policies that facilitate fleet electrification and sustainable mobility,” said José Zozaya, Executive President, AMIA.

A true electromobility transition must adapt these technologies into passenger transportation systems, logistics vehicles and compact vehicles in the public and private sectors. According to AMIA, the required steps for a successful transition include: implementing integral public policies that consider the right juridical framework to boost and regulate the use of these new technologies, supporting potential hybrid and electric vehicle consumers with fiscal and non-fiscal incentives and promoting charging station networks and the use of renewable energy at competitive prices to attract electromobility funding and projects into the country.

Some US companies are investing in Mexico to increase electromobility in the region, said Salazar. These include General Motors’ plant in Silao, Guanajuato, which is beginning to manufacture completely electric trucks. The company also invested US$1 billion in EV production in its plant in Ramos Arizpe, Coahuila. Ford also produces 77,000 annual Mustang Mach-E electric vehicles a year.

Salazar did not address US President Joe Biden’s proposed EV tax credits for US union-made EVs, which are part of the Build Back Better Act. The act has been strongly opposed by Mexico and Canada. However, after failing to receive unanimous Democratic support, the acceptance of the Bill as it is currently drafted seems unlikely.

Earlier this month, Mexico also launched a national electromobility transition team with the US to create a binational route toward transport electrification. And with international shipping troubles as a result of foreign affairs increasing nearshoring trends in the region, collaboration between both countries might strengthen.