Global State of EV Manufacturing & Supply Chain: China & Taiwan
Thailand is emerging as a regional hub in EV manufacturing, leveraging its strategic geographic location and high logistics performance...
Read more21 December 2023
By Dave Chu
Mexico’s EV production is expected to soar by 179% in 2023. This growth is attributed to the influx of new Asian automakers, especially from China. Regions like the Bajío and the northwest are competing to attract foreign investment, spurred by nearshoring trends and the global shift towards electrification in the automotive industry. Mexico’s position as a major automotive manufacturer and its proximity to the US market, bolstered by agreements like the USMCA, make it a strategic location for EV manufacturing.
As the seventh-largest automobile producer globally, Mexico’s auto industry has seen significant growth, especially since gaining full access to the US market. In 2022, Mexico produced over 3.5 million cars, of which only about 2% were BEVs. However, a notable increase in BEV production is anticipated for 2023, with projections of over 220,000 electric vehicles, which would be about 7% of the total production.
Significant investments have been made by major players like Tesla and Tata Group to build gigafactories in Mexico. Additionally, companies like Jetour plan to invest in the establishment of assembly plants specializing in both combustion vehicles and EVs. The focus is not only on vehicle manufacturing but also on battery production and other EV components.
While the market for EVs in Mexico remains small, there’s a noticeable growth in electrified vehicle sales. The popularity of hybrids is evident, but EVs are gaining ground. From 2020 to 2022, the percentage of 100% electric cars among all registered electrified vehicles increased significantly. This trend is expected to continue, with projections of a substantial rise in EV sales by 2030.
For Mexico to fully capitalize on the EV market, several factors need addressing, including expanding charging infrastructure, utilizing renewable energy sources, and implementing consumer education and tax incentives. The country’s established capabilities in motor vehicle manufacturing and its strategic location offer significant opportunities for growth in the EV sector.
In conclusion, Mexico’s EV and automobile manufacturing sector is poised for considerable expansion and transformation, driven by increased domestic production, foreign investments, and a growing market for electrified vehicles. The country’s strategic location and manufacturing capabilities position it as a potential key player in the evolving global EV landscape.