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Mexico has inched nearer to becoming Latin America’s largest vehicle market, Brazil, in BMI’s Business Environment Rankings for the auto industry in the Americas this quarter, supporting BMI’s view that the country will continue emerging as an important auto hub in the region. However, a key factor driving recovery for Mexico’s auto exports and hence production will be the increasing diversification of export destinations.
Not only do we expect carmakers to gear an increasing proportion of their exports to Latin America, but also to markets outside the Americas. Japanese carmaker Nissan Motor’s Mexican subsidiary plans to kick-start its diversification strategy by exporting close to 20,000 Tiida sedan and hatchback cars to the Middle East from as early as this year and we expect more carmakers to follow suit. After a moderate recovery in auto production, to a growth of 15% y-o-y, to just over 1.8mn units by the end of this year, we expect Mexico to grow at an average 9.3% y-o-y between 2011 and 2014, to 2.59mn units – marking an almost 50% increase compared with 2009.
Prospects for domestic demand are less optimistic though. Domestic demand only managed to register its first quarterly sales growth in Q210, taking the end of H110 auto sales only 7.7% higher compared with the same period last year, at 370,967 units. Mindful of this, the Mexican government is therefore stepping up efforts to promote domestic vehicle sales. On top of forcing banks to increase lending to car buyers, it is abolishing the over 40-year-old tax on new car purchases – tenencia – in the hope of kick-starting a recovery in sales.
However, BMI remains sceptical and continues to hold its forecast for sales of 834,000 vehicles by the end of the year, a rise of just over 6% y-o-y. BMI continues to stress that improved vehicle finance offers the best possible support for a recovery in sales.
Supporting our view that Mexico will continue to emerge as a production hub, BMW is looking to triple its parts purchases from Mexico by 2012. More evidence of the growing confidence in Mexicomade components came to light in October last year when Volkswagen de Mexico revealed it was looking to increase its local supplier chain. BMI points out that although the supplier segment in Mexico has historically been under-developed to meet international specifications and quality standards, the increasing presence of leading global brands is helping a globally competent industry emergence.
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Original Source : – Mexico Autos Report Q4 2010
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Browse All Business Monitor International Market Research Reports
Mexico has inched nearer to becoming Latin America’s largest vehicle market, Brazil, in BMI’s Business Environment Rankings for the auto industry in the Americas this quarter, supporting BMI’s view that the country will continue emerging as an important auto hub in the region. However, a key factor driving recovery for Mexico’s auto exports and hence production will be the increasing diversification of export destinations.
Not only do we expect carmakers to gear an increasing proportion of their exports to Latin America, but also to markets outside the Americas. Japanese carmaker Nissan Motor’s Mexican subsidiary plans to kick-start its diversification strategy by exporting close to 20,000 Tiida sedan and hatchback cars to the Middle East from as early as this year and we expect more carmakers to follow suit. After a moderate recovery in auto production, to a growth of 15% y-o-y, to just over 1.8mn units by the end of this year, we expect Mexico to grow at an average 9.3% y-o-y between 2011 and 2014, to 2.59mn units – marking an almost 50% increase compared with 2009.
Prospects for domestic demand are less optimistic though. Domestic demand only managed to register its first quarterly sales growth in Q210, taking the end of H110 auto sales only 7.7% higher compared with the same period last year, at 370,967 units. Mindful of this, the Mexican government is therefore stepping up efforts to promote domestic vehicle sales. On top of forcing banks to increase lending to car buyers, it is abolishing the over 40-year-old tax on new car purchases – tenencia – in the hope of kick-starting a recovery in sales.
However, BMI remains sceptical and continues to hold its forecast for sales of 834,000 vehicles by the end of the year, a rise of just over 6% y-o-y. BMI continues to stress that improved vehicle finance offers the best possible support for a recovery in sales.
Supporting our view that Mexico will continue to emerge as a production hub, BMW is looking to triple its parts purchases from Mexico by 2012. More evidence of the growing confidence in Mexicomade components came to light in October last year when Volkswagen de Mexico revealed it was looking to increase its local supplier chain. BMI points out that although the supplier segment in Mexico has historically been under-developed to meet international specifications and quality standards, the increasing presence of leading global brands is helping a globally competent industry emergence.
About Us
ReportsandReports comprises an online library of 10,000 reports, in-depth market research studies of over 5000 micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.
Contact:
Ms. Sunita
7557 Rambler road,
Suite 727, Dallas, TX 75231
Tel: +1-888-989-8004
http://reportsandreports.blogspot.com/
http://reportsandreports.proarticles.co.uk/
http://reportsnreports.wordpress.com/
Original Source : – Mexico Autos Report Q4 2010
Buy Now : Market Research Report
