Tuesday, June 18, 2024

Mexico’s new car market had its best October in 5 years

More than 110,000 new cars were sold in Mexico in October, the strongest performance for that month since 2018.

The 112,261 light vehicles sold on the domestic market was a 12.2% increase over October 2022. It brought total sales so far this year to nearly 1.1 million, according to data from the Mexican Association of the Automotive Industry and the national statistics agency INEGI.

The arrival of Chinese brands, including JAC, has bolstered the domestic market in Mexico. (JAC)

Despite this growth, October’s sales were down 4.9% from September, and slightly below estimates by the Mexican Association of Automotive Distributors (AMDA).

However, AMDA president Guillermo Rosales said that this was partly due to Mitsubishi having yet to release sales figures for the month and that AMDA expects these gaps to shorten once these are included.

Industry experts also noted that October’s car sales were up 4.8% from the pre-pandemic year of 2019, and marked 16 consecutive months of year-on-year increases. Total national automobile sales for 2023 are expected to reach 1.3 million.

The industry hit a peak in 2016, but declined for several years afterwards, exacerbated by the effects of the COVID-19 pandemic and subsequent supply chain disruption.

The United Auto Workers (UAW) strike in the United States has adversely affected the Mexican autopart industry – although sales of new cars have not declined . (UAW/X)

Since 2021, however, domestic car sales have been recovering steadily, boosted by the strong performance of Mexico’s automotive industry and the arrival of affordable, new Chinese brands to the market.

Despite inroads by new manufacturers, traditional brands Nissan, General Motors and Volkswagen still lead the way as Mexico’s most popular brands, accounting for around 41% of total light vehicle sales. 

Volkswagen showed particularly strong growth, increasing its sales by more than 100% from October 2022, according to the AMDA.

While the strike by auto workers in the United States does not appear to be affecting car sales in the Mexican market, it is having an impact on the auto parts manufacturing sector, with order losses of up to US $780 million.

With reports from El Economista and El Financiero

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