0
Mexican Auto~Car Market~Marketplace Snapshot
Following two consecutive many years of declines in product sales, the marketplace registered 3.3% fewer vehicles, to 188,944 units, throughout Q110, meaning that domestic product sales are yet to bottom out. Provided that we expect need in 2010 to become assisted through the base impact from 2009 sales, we forecast product sales to grow by just more than 6% y-o-y, to 834,000 units, by 2010. However, impeded by an anticipated slowdown in the US financial activity in 2011 and the proposed tax hikes domestically, we expect autos product sales to recover to one.12mn units by the end of 2014, getting only partially recovered in the 1.14mn units sold in 2007.
Recuperation in autos production, however, is likely to become quicker, as we expect carmakers to progressively concentrate on exports to drive up their capacity utilisation. Following a close to 10% y-o-y increase in production, to 1.73mn models in 2010, we expect production to achieve 2.33mn units through the finish of 2014. We believe that a main support to this degree will arrive from targeting more growth-promising markets in Latin American and Asia.
Indicators of these currently surfaced last yr when India’s Tata Motors, in collaboration with nearby manufacturer Grupo Autofin, announced plans to create its ultra-low-cost Nano design in Mexico from 2012 with the view to supply its automobiles in the Latin American market. Meanwhile, Honda Motor, in November last year, created an expense of US$6mn in a manufacturing line at its El Salto plant to aid assemble its new CR-V sport utility vehicle (SUV) at the plant. Indeed, this kind of investments have helped Mexico rank in the third position in BMI’s regional ratings this quarter.
BMI points out that an extra benefit to Mexico from this kind of expansions is going to be the emergence of an integrated supplier base, within the presence of both nearby and global suppliers. Having built powerful associations with global customers, most Mexican vendors are venturing for worldwide recognition and expertise via acquisition of companies of their competing international firms. Metalsa and Katcom current stand as the greatest example of the trend.
Although the Mexican autos business association AMIA has called for the federal government to introduce regulations and incentives to encourage new vehicle sales, BMI stresses that improved autos financing provides the very best feasible support for recuperation within the country’s autos demand.
Sell your used car now. Our “autos a la venta” directory offers free advertising of cars for sale. Find the car you are looking for at our ” venta de autos en Argentina” site.