Mexican Auto Market Will See Major Changes In The Next Few Years.(Brief Article)

Mexico has become a growth area for automobile production in North America over the last ten years. The impact of trade agreements on the Mexican auto industry and market -- notably NAFTA -- is well documented. However, there are additional uncertainties in the future posed by trade agreements according to Arturo Elias, President, General Motors de Mexico.

In an interview with just-auto.com, Elias said: "Two issues stand out. First, 53 percent of the passenger cars that we sell in Mexico are in the mini/economy segment, i.e. entry-level vehicles like our Chevy and Monza (Corsa platform), Ford's Fiesta and Fiesta Ikon, Nissan's Tsuru (old Sentra), Volkswagen's Pointer and Seat's Ibiza and Cordoba. All of these have major production centers in MERCOSUR (a trading block of six countries in South America including Argentina and Brazil) and Europe.

As a result, the outcome of future negotiations with these trade blocs will affect Mexican market dynamics in 2005 and beyond. Second, the real impact of NAFTA will be felt between 2004 and 2009, once free trade in both new and used vehicles is implemented; 2009 is an especially crucial date because that is when used vehicles can be imported without restrictions. And, it is likely that many of these passenger cars will compete directly with the new entry-level vehicles that are sold in Mexico.

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