Mexico’s Auto Part Production Hits All-Time High: INA

The auto part market will keep growing, reaching US$109 billion in 2023 and surpassing US$110 billion in 2024, added Bustamante. The USMCA plays a critical role in the evolution of North America’s manufacturing sector, as Mexico's automaking capabilities are critical for automakers that desire to be closer to their customers in the US and Canada. 

The sector is expected to keep growing. “In recent months, over US$10 billion in Foreign Direct Investment (FDI) has been announced, which will be reflected in the first months of next year,” said INA. 

The main barriers to this growth are semiconductors shortages and compliance with the collective bargaining agreements that expire in May 2023, said INA. The organization estimates that at least 285,000 vehicles will be affected by the lack of semiconductors. Furthermore, the program to regularize “chocolate” cars is still challenging Mexico’s automotive industry, as its latest extension has not solved any of the problems the program initially set to solve, said Fausto Cuevas, Director, INA. "The extension of this measure only led to the increase in the illegal introduction of contraband vehicles into our country," said Cuevas, as reported by Forbes Mexico. 

Guanajuato is among the top five states in the auto parts market, adding up to 11 percent of total domestic production. The state’s automotive sector has received a total of US$20 billion investment since 1992, said Alfredo Arzola López, Director, Automotive Cluster of the State of Guanajuato (CLAUGTO), as reported by Periódico AM. 

"For the auto parts industry in Guanajuato, the most recent data I have is a growth of 18 percent while nationally it was 12 percent. Due to relocation, global conflicts and the USMCA, companies expanded their market, production, investments and jobs in states such as Guanajuato," said Arzola.