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automotive production and exports chart Orange totals represent production, exports are in green.

Auto exports to US hit record high in 2017

US export numbers up 9% despite uncertainties over trade

The Mexican automotive industry set new records for vehicle production and exports in 2017 despite fears that uncertainty surrounding the renegotiation of the North American Free Trade Agreement (NAFTA) could have a negative impact on the sector.

Auto production increased 9% on 2016 figures and exports grew by 12.1%, the Mexican Auto Industry Association (AMIA) reported. In total, almost 3.8 million cars were built in Mexico last year and just over 3.1 million were exported.

The biggest export destination by far was the United States, receiving more than 2.3 million Mexican-made vehicles.

AMIA president Eduardo Solís said the figure represented “the highest number of vehicles that we have exported to that country in history.”

However, export growth to the U.S. of 9.4% was slightly lower than the overall increase, mainly because shipments to other parts of the world surged.

Exports to Europe spiked 45.2%, driven by demand in Germany where 96,753 cars were sent. Shipments to Asia also increased significantly, up 38.1% on 2016 figures.

Exports to Mexico’s other NAFTA partner, Canada, also grew but by a more modest 8.5%.

AMIA also highlighted that vehicle exports exceeded production in December, something that has only happened a few times before.

Solís said that the strong performance of the sector was particularly impressive considering what has been said at the NAFTA renegotiating table and rumors that Mexico would be unable to continue exporting the same quantity of vehicles to the U.S.

“In a year when there was a lot of uncertainty about whether exports were going to be affected . . . I think that it’s important to reiterate that not only did we reach an all-time high export figure to the world but we also reached a never before seen number [of exports] to the United States,” he said.

Nissan was the largest producer of vehicles in Mexico last year, manufacturing 829,262 units, followed by General Motors with 805,758 and Fiat Chrysler with 638,653. The Nissan Sentra and Versa took out the top two places in terms of exports followed by the Volkswagen Jetta.

Despite achieving record highs last year, production and export forecasts for 2018 are even higher.

The AMIA said that at least four million cars are projected to be made in Mexico this year and around 3.2 million of them will be exported.

However, not all news out of the sector was as positive as the export and production growth.

The domestic market failed to keep pace, with sales declining by 4.6%. And the top three automakers — Nissan, General Motors and Volkswagen — all recorded sales declines in 2017.

Ford was also hit hard, experiencing an almost 18% drop in sales.

The director of the Mexican Association of Auto Distributors, Guillermo Rosales, said that high inflation was one of the biggest factors behind the downturn in the Mexican market.

Source: El Universal (sp)

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