Renault Opens Mexico Auto Parts Hub for South America

Renault has expanded its operations in Mexico with the creation of a new auto parts procurement and conditioning hub, aimed at supplying its manufacturing plants in South America and strengthening its aftermarket network in Mexico. The new unit will begin operations in October and provide components for vehicle assembly in Colombia, Brazil, and Argentina.

“Mexico has a spectacular supplier base. We have opened a new business unit set to start in October and the objective is to increase Mexican-sourced parts in the vehicles manufactured in Colombia, Brazil and Argentina. It is a new unit, it is a reality, and we will be starting the first shipments of parts for all the plants,” said Jesús Gallo, CEO, Renault México.

In Colombia, Renault produces the Stepway and Duster models; in Brazil, the Kardian, Kwid, Logan and Oroch; and in Argentina, the Kangoo and Kangoo ZE. The company is seeking to leverage Mexico’s established supplier network to improve efficiency in its supply chains. According to the National Auto Parts Industry (INA), Mexico closed 2024 with a record US$121.16 billion in component production, consolidating its position as the fourth-largest global producer and the top supplier of parts to the US market.

“Talking about Mexico as a location for a parts procurement center makes sense,” said Gallo. He explained that despite closed economies like Brazil, where local content rules apply, trade agreements allow for partial regional value content. “Not all the content has to be local. There are percentages of a vehicle’s value, and it is not the same for an engine as for a tire or a steering wheel. There are defined percentages of what we call regional value content, which form part of trade agreements and vary from one agreement to another.”

Renault expects the hub to also play a key role in the domestic aftermarket. The goal is to supply dealerships with parts from local providers, reducing reliance on imports from France and Brazil that increase costs and lead times. “Tomorrow there may be suppliers that can manufacture the same part here and supply it directly to our warehouse,” Gallo said.

Until recently, Renault’s parts management was handled by Nissan as part of their long-standing alliance. Following a reduction in Renault’s stake in Nissan, the company decided to assume direct control of its parts business in Mexico. This move aligns with its strategy to operate independently in the country while opening new opportunities for local suppliers.