This week, Mexico's automotive sector attracted a record-breaking $5.024 billion FDI in 1H23, showcasing its global competitiveness. Meanwhile, Kaga Electronics is strategically entering Mexico's Electronic Manufacturing Services (EMS) market, while BBVA leverages Mexico's industrial potential.
In other news, Xpeng announced an alliance with DiDi, setting the stage for a new EV brand. India's auto industry is rapidly expanding and some businesses may turn to Mexico.
Fasten your seatbelts! This is the Week in Automotive!
Mexico's automotive industry attracted a record-breaking amount of Foreign Direct Investment (FDI) in the first half of 2023, receiving over US$5.024 billion for the production of cars and trucks. This figure surpassed not only previous records for a similar period but also set a new benchmark, highlighting Mexico's position as a highly competitive player in the global automotive market.
Xpeng, a leading Chinese company specializing in the design and manufacturing of smart EVs, allied with DiDi to lay the foundation for the introduction of a new EV brand. Under the name "MONA," these vehicles are expected to carry a price tag of approximately US$20,602.
India's automotive industry is rapidly accelerating toward becoming the third largest in the world by 2030, bolstered by strategic government schemes and innovative collaborations. This rapid expansion is not limited to Asia, as some Indian giants are also investing in Mexico.
Kaga Electronics Co. has started a strategic plan to meet the demand for Electronic Manufacturing Services (EMS) in Mexico through a new plant in San Luis Potosí. The upcoming facility will be strategically located in Parque Industrial Millenium in Arroyos.
BBVA positioned itself as a powerhouse in Mexico's automotive financing and nearshoring. The bank attributes its success in the industry to the strategic advantages of nearshoring. BBVA has a 24% market share within the Business and Government Banking (BEyG) sector and has extended over 52,000 automotive loans in Mexico throughout 2023.
View From the Top
Strategic alliances will be key in helping local automotive businesses comply with USMCA’s regulations regarding regional content. "When I speak about collaboration, I mean between key stakeholders, which are the private sector, the government and the academic sector," says Armando Cortes, General Director, INA.