STORY INLINE POST
In Mexico, a transformation is underway within the automotive sector, subtly yet undeniably shifting paradigms. Over the past two years, leasing companies have witnessed a surge in demand, resulting in an influx of vehicles. This surge signifies a noteworthy shift toward leasing as a preferred mobility option among Mexicans. The data speaks volumes. According to the Mexican Association of Vehicle Distributors (AMDA), in the initial six months of 2021, these companies acquired 20,830 vehicles through credit. Fast forward to 2023, and this figure skyrocketed to 28,213 — a remarkable 35% growth in just two years.
This shift can be attributed to several factors. Firstly, the uptick in interest rates has made traditional car ownership via credit less attractive. Given that nearly 60% of Mexicans opt for credit when purchasing a new vehicle, this change in financial dynamics has had a profound impact. Moreover, the economic landscape has prompted a reevaluation of financing strategies. In response to escalating prices, financial institutions and banks are extending the financing period. It's not uncommon to find credit spanning up to 72 months for a car purchase — equivalent to six years of financial commitment. For many, this extended timeline feels daunting.
In this climate, leasing emerges as the beacon of flexibility. Unlike traditional ownership, leasing offers a spectrum of options in terms of monthly payments, tenures, and ancillary services provided by leasing companies. Platforms like BitCar exemplify this flexibility by tailoring plans to individual needs. While this may seem akin to offerings from traditional financial institutions, there's a critical distinction: the down payment.
While conventional car purchases demand a down payment of 20% to 30% of the vehicle's value — a significant financial commitment for families — leasing, contingent on credit score, allows clients to secure a new car for as little as a single month's payment.
This financial relief holds particular significance in a world characterized by uncertainty. While the specter of a global recession may be receding, lingering concerns about wars, natural disasters, political shifts, and trade tensions underscore the need for families to tread cautiously. Retaining savings while enjoying the benefits of a new car is becoming an increasingly invaluable proposition. Through interactions with our customers and an analysis of market data, a clear trend emerges: a growing preference for short-term commitments. Leasing, offering usage without the burdens of long-term ownership, is gaining traction.
While the journey toward widespread leasing adoption in Mexico is ongoing, the trajectory is clear. As an industry, we must continue to illuminate the advantages of leasing models and illustrate how seamlessly they integrate into our customers' lives.
A Vision for the Future
Optimism meets ambition in our industry's aspirations. With the current conditions in place, progressing from 28,213 cars acquired by leasing companies to 50,000 units in the coming years is a realistic goal. While not without its challenges, it represents a tangible step forward for the Mexican automotive market.
As Mexico steers toward a future where leasing takes center stage, the stage is set for a transformative era in the country's automotive industry.