Navigating Mexico Through Terranean Journeys
Mexico's automotive industry is experiencing a significant surge, with the country emerging as a key player in the global vehicle manufacturing scene. The US market's recovery, coupled with Mexico's strategic location between the recovering American market and the rapidly growing Latin American economies, is creating a favourable environment for carmakers.
The well-established car manufacturing sector in Mexico, combined with competitive labor costs, has encouraged numerous Original Equipment Manufacturers (OEMs) to invest in new plants and expand existing ones. Companies such as Fiat-Chrysler, Ford, General Motors, Honda, Mazda, Audi, and Nissan are among those making substantial investments in Mexico.
The growth in vehicle production in Mexico has been substantial. In 2010, Mexico was in eighth place in global vehicle export rankings. However, recent years have seen a significant rise, with Mexico now exporting approximately 2.4 million vehicles last year, making it the world’s fourth largest vehicle exporter.
The majority of this new capacity for vehicle production in Mexico is intended for export, with the domestic Mexican market remaining relatively small at 900,000 units a year. Despite this, the domestic market is forecasted to grow by around 5% annually.
Mexico's trading relationships with both the US market and the growing Latin American economies are another factor contributing to its success. The country's potential on the rails for car transportation and the growth of its supplier base further strengthen its position in the global automotive industry.
Expectations are that Mexico's vehicle production could reach 4 million units near the end of the decade, indicating a potential turning of the tide towards increased car production in Mexico. This growth could lead to further movement up the charts in global vehicle export rankings.
However, it's worth noting that there are no specific details available about which companies prepared new manufacturing investments in Mexico in 2016 or whether these investments are already operational. Despite this, the overall trend suggests a continued growth trend in Mexico's vehicle manufacturing sector.
In conclusion, Mexico's strategic location, competitive labor costs, and robust trading relationships make it an attractive destination for carmakers. The country's automotive industry is well-positioned for continued growth, with expectations of reaching 4 million units in vehicle production by the end of the decade.
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