Mexico’s auto parts imports on the rise, spearheaded by Germany, China
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In 2018, Mexico is importing more auto parts, especially from Germany and China, to serve automakers’ operations in the country, Reforma paper reported recently citing data from the Bank of Mexico and the Ministry of Economy (SE).
In the period between January and May, US$ 11.3 billion in auto parts were brought in from abroad, which was a growth of 13% over the same period last year, according to Banxico.
Regarding the origin of supplies, data from January to April of the SE determined that the United States is the supplier of 54% of total, followed by Germany with a 10.8% market share, and China with 7.9% of the total. Both Germany and China recently overtook Japan and Canada, which had traditionally been strong suppliers to Mexico’s auto industry.
In the period mentioned, but in 2016, Germany exported to Mexico only US$ 277 million, in parts, while for 2018 the figure grew to US$ 954 million. In the same period, exports of auto parts from China to Mexico went from US$ 527 million to US$ 703 million.
Among the reasons for the increase in imports is the growth of the Volkswagen plant in Puebla, which produces Tiguan SUVs for several markets, as well as the start of Audi operations in the same state, and the development of supplies and inventories required by BMW, which is putting the final touches to its plant in San Luis Potosi.
"In the specific case of Germany there is a strong commitment, a strong investment for the supply of its new plants, China is growing in the automotive sector because they are very good at imitating technologies and reproducing on a large scale, even if they are of lower quality, but at a very good cost", explained Manuel Diaz, president of Seiko Logistics, a company specializing in foreign trade that is responsible for the logistics for several assembly plants.