The automotive industry in Mexico is at a crucial moment for its growth and consolidation with nearshoring, accumulating during the first quarter of 2024 more than 3.286 billion dollars in Foreign Direct Investment (FDI) in car and truck manufacturing alone.
The investment amounts of this period surpassed the flow of FDI that came to Mexico every year from 1999 to 2016, and also represented 64.5% of all that was received in 2023, when 5 billion 91 million dollars were reported.
Mexico offers a number of competitive advantages that position it as an attractive destination for investment in the automotive industry. These advantages include a solid logistics infrastructure with international bridges, seaports, highways and airports.
In addition to modern industrial park facilities and availability of manufacturing sites. The skilled and competitive labor force in terms of wages, together with a privileged geographic location close to the United States, the world’s largest consumer of automobiles, make the country a strategic location for the automotive industry.
Mexican production; The great global attraction
Since the Ministry of Economy began recording FDI flows (1999), the United States has maintained its position as the country that invests the most in Mexico in automotive manufacturing processes, specifically in the manufacture of cars and trucks, with an accumulated investment of over 17.352 billion dollars.
However, other countries such as Japan and Germany are gaining ground in this area, with accumulated investments of 12,960 million dollars and 11,911 million dollars, respectively, a diversification that reflects the confidence and potential of the automotive industry in the international market.
Top 5 FDI in the automotive industry
In the last 25 years, FDI that has come to Mexico for automotive manufacturing has accumulated more than 48,412 million dollars, and since the pandemic economic reactivation, the growth was more evident.
An analysis by Mexico Industry, based on data from the Ministry of Economy, highlights that in 2023, the manufacture of cars and trucks, bodies, trailers and parts for motor vehicles had a significant FDI impact in five states: Mexico City, Aguascalientes, State of Mexico, Chihuahua and Guanajuato, which together totaled 4 billion 979 million dollars of foreign investment.
Mexico City led FDI absorption with 1.248 billion dollars, followed by Aguascalientes with 1.132 billion dollars, the State of Mexico with 1.118 billion dollars, Chihuahua with 779 million dollars and Guanajuato with more than 702 million dollars. These states have proven to be key industrial development poles, attracting significant investments and contributing to the growth and consolidation of the automotive industry in Mexico.
The continuous growth of FDI in the Mexican automotive industry is an indicator of the strength of the sector and of the opportunities offered to future projects, in addition to the competitive advantages offered at the national level, showing that related manufacturing gives the necessary push and strengths for competitiveness in the face of nearshoring.
