Bloomberg and USA Today are once again touting the booming auto industry in Mexico,citing record investment numbers and rising production over the last few years. In addition,Mexico real estate has emerged as the number one competitor for automotive jobs in North America,recently replacing the southeastern U.S. as the region with the fastest-growing automotive industry,attracting more than $11 billion in new investment dollars between 2010 and 2012.
"Mexican production of cars and light trucks increased 19.8 percent in January from the year earlier,” writes Bloomberg. “Vehicle exports climbed 14.2 percent over the same period.”
Also of note,overall automotive production rose 1.6 percent in February versus one year ago,showing the trend has no signs of slowing down. This sharp rise in Mexico’s auto output is due to the nation’s less expensive labor and the large number of free trade agreements it holds with 44 nations,compared to only 19 for the U.S.
“Vehicle production in Mexico is projected to grow more than 20 percent from 2.8 million vehicles in 2012 to 3.5 million vehicles in 2015,” writes USA Today. “That would give Mexico nearly 20 percent of all North American vehicle production.”
Automakers that are reportedly planning to increase existing production or begin anew in Mexico currently include Audi,Daimler,Honda,Hyundai,Mazda,Mitsubishi,Nissan and Toyota,while BMW is also rumored to have plans to build factories in Mexico. With this growth,Mexico is expected to become home to a variety of new auto industry suppliers.
“The United States and Canada will find it tough to compete with Mexico’s giant labor pool and lower wages,” writes USA Today. “The number of auto suppliers is bound to grow in Mexico. The governors of four Mexican states were among those attending the Detroit Auto Show last month.”