Regionalization ContinuesBy Alejandro Enríquez | Thu, 10/08/2020 - 16:39
Automakers are taking different stances toward markets in different regions. In Europe, Volkswagen expects 90 percent of its sales in Norway to come from fully EVs. Meanwhile, Nissan, Toyota and BMW have expressed serious concerns about a no-deal Brexit.
As for North America, electrification continues as Toyota announced the development of a fuel-cell electric truck for the region, while Tesla expects to produce 500,000 vehicles in 2020. Regarding the Mexican market, production recovery was paused as year-on-year production in September dropped by 5.5 percent. Month-on-month vehicle sales jumped a slight 0.9 percent in September but year-on-year figures dropped 22.8 percent.
Speaking of regionalization, this week Mexico Business News hosted the webinar: Supply Chain Relocation and Development in North America. Do not miss our highlights below.
Finally, do not miss our interviews with Mexican Heavy OEM DINA and with Scania Mexico's People Experiences and Services Director.
Buckle up, this is the Week in Automotive!
Mexican Production and Sales
AMDA reported that the month-on-month double-digit grow rate seen in vehicle sales decelerated considerably as sales grew only 0.9 percent in September compared to August while suffering a year-on-year 22.8 percent drop, the worst drop for a September since 2009.
As for production, figures continue to show negative numbers after 14 months in a row. In September, they dropped year-on-year 13 percent, while exports to the US dropped 16 percent.
On the bright side, INA told El Economista auto part production could reach US$77 billion by the end of 2020, greater than what the association expected in June.
Regionalization Is the Name of the Game
The pandemic, the US-China trade-war and even Brexit are passing the bill to automotive supply chains and nearshoring approaches are the new normal now. During our webinar, Supply Chain Relocation and Development in North America, sponsored by American Industries and Iberdrola, industry leaders from American Industries, Zacua, KPMG and Brose detailed the region's landscape for automotive manufacturing, as well as the opportunities Mexico can take.
To get an in-depth perspective about automotive sales and the way dealerships in Mexico are adapting to new market conditions, read our interview with Guillermo Rosales, General Director of AMDA.
Learn more about Mexican heavy-vehicle OEM DINA and its ambitious plans to strengthen its presence in the market.
Take a look at a series of interviews with talent managers in the automotive industry. We begin our series with Maite Delgadillo from, Scania México.
Fears About Brexit
Regional markets are reshaping themselves and the industry has not seen the end of Brexit yet. As the UK-EU negotiations seem to find no way out, automakers have already expressed their concerns about a no-deal Brexit that could imply a 10 percent tariff on vehicles and auto parts. BMW's CFO Nicolas Peter said today that a no-deal Brexit could cost €$11 billion (US$12.9 billion).
Toyota and Nissan to ask the UK government for a reimbursement on additional custom charges should the UK fail to reach a deal with the EU, Nikkei reported.
On a more positive note, Volkswagen expects 90 percent of its sales in Norway to come from electric vehicles, being likely that EVs completely replace diesel and gasoline engines by 2023 in the country.
North American Market Electrified
Reuters reported that Elon Musk told employees the company is close to producing 500,000 by the end of 2020. The company has already announced it delivered a record of 139,300 vehicles in 3Q20.
As for heavy vehicles, Toyota will develop a fuel-cell electric truck through its subsidiary Hino Motors that will target North American market needs.