Amidst uncertainty of NAFTA, foreign investment keeps flowing into Mexico’s auto industry
Amidst the uncertainty due to the renegotiation of the North American Free Trade Agreement (NAFTA) and the imposition of tariffs by the U.S. government, foreign investment keeps flowing into the automotive industry in Mexico, especially from Japan, the United States and Germany, revealed Oscar Albin, president of the National Automobile Industry (INA).
“They are our great auto parts manufacturing technologists, but in particular Japanese investment is growing with the installation of the Toyota plant in Guanajuato,” said the official at the Automechanika 2018 event in Mexico City.
According to figures from Albin, it is estimated that by 2018, foreign automotive investment will amount between US$3 and US$4 billion, a figure lower than that reported in 2017 and 2016, of approximately US$6 billion. The executive estimates that somewhere between US$1.4 and US$1.6 billion have been attracted in the first half of the year.
“NAFTA keeps us expectant and there is a great uncertainty, but I believe it will finally close down,” he said. “However, we have not reduced production for the domestic and export markets, new investments and new plants keep coming, that keeps us in the mood, in the United States it is decreasing, but last year there were many model changes, sedans plants that were adapted for SUVs and pickups, which caused the traditional volume of NAFTA of 17 million cars to fall to 16.5 million,” said Albin.