The main figures of the national automotive industry had a modest balance. Although it is true that the sale of new units advanced slightly, production did not perform as expected and reflected problems related to various phenomena. The importance of this sector for the country’s economy is very great as it represents one million direct jobs while it reaches 4% of the Gross Domestic Product (GDP), and 20.5 of the manufacturing GDP according to the information provided by the Mexican Association of the Automotive Industry (AMIA).
Almost two years after the start of the Covid-19 pandemic the Mexican market has deeply felt its effects. It is necessary to clarify that the slowdown in the sector is not due exclusively to the global contingency caused by this disease that appeared at the end of 2019. The year-on-year decrease in the sale of zero-kilometre units was recorded since 2017 with a level of 1,534,943 cars , just a year before the record of 1,607,165 units was set.
According to the report issued jointly by AMIA and the Mexican Association of Automotive Dealers (AMDA), in January 2018, the main negative factors throughout the year were the impact on the purchasing power of consumers due to high inflation, as well as the volatility in the exchange rate present at the end of the year as a consequence of the announced tax reform in the United States without failing to mention the events related to the beginning of the electoral process.
For 2020 and 2021 the Covid-19 It has not allowed a clear rebound since it has hit the industry globally, from manufacturers, suppliers, logistics companies, among others. A slight change in the world outlook allowed our market to have a little more product and slightly alleviated consumer demand for a new car. Availability problems that were reflected in long waiting periods that could exceed more than two months, caused discouragement among consumers and the search for other options such as the acquisition of a second-hand. For Gerardo Carmona, Director of the Peugeot brand at Stellantis Mexico, not having the required units was caused by production problems and its consequences were seen in the modest market share of the French brand.
“In 2021 we finished with a 1.12% market share, which the truth is that we could have done much more because we had months with a record of 1.3% in the first semester, but the second was already very affected by availability since practically all products that we bring are imported, most of them come from Europe, which are the countries that had the most restrictions to continue producing due to Covid issues, so the impact we had was a little greater than that of the rest of the industry in the second half . For 2022 we expect better performance due to a higher level of availability and sustained demand for the models we recently launched. The 208 has a great acceptance but above all our SUV range. We also see that, depending on the model, customers like the car so much that they know there is a shortage in the market but they prefer to wait to have the vehicle.”
There were almost four million units produced in 2017 that marked a new milestone in the production capacity of light rail vehicles in our country. This figure was the highest in a period of great manufacturing dynamism that began in 2012 with 2,884,869 vehicles manufactured and grew annually to 3,933,154 vehicles. But once again the adversities due to Covid-19 put a brake on the gears of this activity.
The technical stoppages that several plants located in the national territory suffered were due to the absence of microprocessors and chips. The lack of supply caused the production lines to have pauses due to the lack of parts such as control modules, infotainment screens, among others. To understand the relevance of these components in the assembly of a unit, the average number of semiconductors that a vehicle uses (depending on the type and its applications), is between 200 or 300 semiconductors. There are different types such as remote connection to make the link with other systems, and others that operate the required mathematics.
At the end of last November and interviewed by El Economista, the then president of the National Auto Parts Industry, Engineer Oscar Albin, declared that the increase in production costs and the reduction in profit margins were another headache: “Also There is the unusual increase in the cost of raw materials and logistics, which means that some vehicles that have a very marginal profit margin restrict their manufacturing, first of all because raw materials rose and the margin was cut or could even be reduced. negative, and on the other hand, if you don’t have enough chips, then it is better to produce what does generate profit, even if it is a greater volume, but which can lead to serious economic complications”.
shipping of products made in Mexico had growth in 2021 at an annualized figure. Thanks to the figures provided by the Administrative Registry of the Automotive Industry of Light Vehicles (RAIAVL) prepared by the Inegi, our country placed 2,706,980 units abroad, mainly in the United States (80% of the total), and Canada, which meant a increase of 0.9% compared to the period January to December 2020.