Bullish Views Playing Out As Market Remains Strong

Light vehicle production increased 5.1% year-on-year (y-o-y) in Mexico over the first six months of 2013, to 1,488,162 units. BMI maintains our bullish view on the market, forecasting 9.7% growth in passenger car production and 5.7% growth in light commercial vehicle production in 2013 on the back of the strong sales and export outlook.

There are a number of strong fundamentals underpinning our bullish production view, including low labour costs; relative weakness in the peso, which will serve to make exports more competitive; a high number of free trade agreements (FTAs); and comparative weakness in the productive capacity of Mexico's regional competitors (s ee 'Regional Production Hub To Continue To Attract Investment', March 5 ). We believe that these factors should continue to attract autos investment in the country, particularly for export-orientated production.

Exports Drive Output Growth

Regional Production Hub
Mexico Light Vehicle Export Destinations H113, %

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This article is tagged to:
Sector: Autos
Geography: Mexico, Mexico, United States, Mexico, Mexico

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