Mexico's Auto Parts Exports To Get Boost From Weak Peso.

The Mexican auto parts industry is expecting exports to grow in 2003 if the peso currency remains weak. Mexico's auto parts exports grew almost 9 percent last year, as the peso depreciated 12 percent against the U.S. dollar, making Mexican goods more competitive in the U.S. market.

"With the peso depreciation and the lower demand for new vehicles in the United States car owners were repairing used vehicles and demanding more auto parts," said Omar Zuniga, director of economic studies for the National Autoparts Industry (INA) business association.

Zuniga said the association of 150 auto parts makers expects 203 exports to continue the same trend. The peso has lost more than 6 percent against the dollar so far this year. Mexico is the 10th-biggest automobile producer in the world and the biggest auto parts manufacturer in Latin America.

In 2002 Mexico exported $10.848 billion worth of auto parts, up from $8.390 billion in 2001, according to INA statistics, which include indirect exports, which are sales of parts to Mexican car assembly plants that then export assembled cars.

Mexican parts makers supply between 30 percent and 60 percent of the parts that Mexico-based assembly plants use, depending on the model.

Total auto parts production fell, however, 3 percent to $16.921 billion, as Mexico slowly emerged from an economic recession. Auto production in Mexico also fell in 2002, down 2.4 percent to 1,774,370 units, due to slower demand for new cars in the United States. Auto exports fell 6.5 percent.