Covering the Industry's Economic, Legal & Financial Issues

MexicanAutomotive covers the Mexican automotive and auto parts industries, and is published monthly in English and Spanish. MexicanAutomotive reports on general Mexican automotive industry topics, as well as economic, financial and legal issues affecting the North American automotive industry. Published by Cacheaux, Cavazos & Newton (CCN), subscriptions to MexicanAutomotive are free. CCN is an international law firm with offices in Texas and Mexico. The firm provides legal services in many practice areas including Automotive law to clients doing business in the NAFTA region.

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Ford Announces $2.5 Billion Dollar Investment in Mexico E-mail

Ford announced two investment plans to supplement the 90th anniversary of the company’s operations in Mexico. The investment will consist of $1.3 billion dollars allocated to the production of engines in its Chihuahua plant, which will produce two new types of diesel power systems. Additionally, 1.2 billion dollars will be allocated for the manufacture of transmissions. This investment will be made together with the German firm Gertag.

 

 

 
Mexico City Innovates With Electric Scooters for Rent E-mail

Mexico City traffic is among the most complicated of any city in the world. As one of the world’s most populated cities, with an inadequate public transport system (despite multiple efforts to modernize and streamline such), many residents are seeking new ways to ease their movement around the city. Mexico City authorities have implemented a system of bike rentals in areas of particular congestion, while some roads now have bike lanes. The city has also established programs to place limits on the movement of vehicles, and many other measures, some of which have been successful and well received by transport users.  Individuals themselves have experimented with private taxis, like Uber, which have become popular and operate in certain areas of the city, mainly the west and south. The latest is an innovative program for moped or electric scooter rental that has proved a good choice for a group of users in some areas of the city. The project is known as Econduce® and consists of electric bikes that have ability to travel up to 45 kilometers per hour and are set to be rented to those who meet certain requirements, such as having a driver's license and credit card.  Renters go to service centers to pick up the vehicle, and then return it to the same or another service station at the end of the rental period. Rental rates vary by hour, day or week. There are already a dozen service stations in the city. The project began with 50 scooters and in short expanded to offer 100 units. It is a transportation system that does not pollute, create much noise, is agile, safe and simple to use. The vehicles are light, which makes them easy to drive at 80 kilograms. Their speed is limited to 55 kilometers per hour, and helmets are required and available at designated service stations.

 
Audi Reopens in the Mexican Market E-mail

In Mexico, carmaker Audi operates in the segment known as “Premium,” which refers to luxury cars. According to Walter Hanek, General Director of Audi-Mexico, this segment grew by 5.95%, and Audi increased 4.3%, which presages another good year. The same automotive official also announced new releases for 2015. After offering the A6 and A7, the company will follow with the A1 and A1 hatchback for younger drivers, and those who think they are young. Next they will present the SUV Q3, followed in the next half of the year by the sporty TT. The novelty of these Audi models is that they have accessories that the car owner can individualize, which may not necessarily increase sales, but will – as affirmed by the General Director - increase user satisfaction. For example, Audi offers a package called Audi Plus and offers complementary maintenance for the first three years, which will allow the car owner to only worry about filling the tank. Audi is conscious that it needs to extend its zone of influence in Mexico, so it has announced the appointment of dealers in the state of Sonora, and the company desires to have more dealers in Monterrey and the Los Cabos area.

 
Kia Will Invest $3 Billion Dollars in Mexico E-mail

The Korean automaker Kia announced an investment of $3 billion dollars in a plant located in the state of Nuevo Leon. The geographic position of Mexico, as neighbor to the U.S., the largest consumer in the world, as well as the structural economic reforms, were cited as reasons for the investment, which will create 3,000 new direct jobs, and an estimated 7,000 supplier jobs. Mr. Soon Nam Lee, the vice-president of Kia Motors, stated that the production which will begin in 2016 and will be at full capacity by 2018, with production being allocated 60% to North America, 20% to South America and the remaining 20% to Mexico. Kia is already a player in the Mexican market and currently has plants located in Korea, United States and Slovakia. In Mexico, 21 dealer distributors operate in 10 cities across the country. Such dealerships will sell the Sportage, Sorento and Forte models beginning in July 2015. The Optima model, which successfully debuted at the New York Auto Show, will arrive in November. The company hopes to reach a 5% share of the Mexican market. Kia is confident this project will be a success, with Mexico being a partner with the United States and Canada in NAFTA, as well as a party to numerous trade agreements with countries in South America, the Pacific Rim and the European Union. The Kia executive, Soon Nam Lee, told NOTIMEX that investing in Mexico is a good business deal, as evidenced by the major global automotive companies that have established themselves in Mexico, which has made the automotive sector in Mexico: “one of the most dynamic and an important generator of employment and trade for the country.”

 
The most popular makes and models sold in Mexico E-mail

Nissan leads the race for market share in Mexico, with 26.5% of the Mexican automotive market, followed by General Motors with 18.5%, Volkswagen with 14%, Grupo FCA with 7.7%, Ford 6.6%, Toyota 5.9% and Honda 5.5%.

 

 

The most popular selling models are Aveo, with the Versa in second place, followed by the Tsuru, Spark and March. Next are the new Jetta, and finally Sentra Chasis, Largo, and Matiz.

 
New Investment by Nissan in Aguascalientes E-mail

Nissan announced a $1.3 billion dollar investment, partnering with Daimler, to manufacture Infinity and Mercedes Benz models in Mexico, which would be sold in the North American market. The announcement was made by Nissan President Jose Muñoz in a recent television interview. Construction of the plant will begin this year, located next to the existing Nissan plant known as Aguascalientes II. The first Infiniti models will be ready for sale in 2017, with the first Mercedes models rolling out in 2018. The plan is to manufacture 300,000 vehicles per year, which will generate 10,000 direct new jobs. With this investment plan, Nissan maintains its lead as manufacturer of vehicles in Mexico.

 
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