Mexico To Triple EV Manufacturing In 2023

Large amongst creating nations, Mexico stands presently because the seventh-largest vehicle producer on the earth (in variety of models). It’s the fifth-largest vehicle exporter (in whole worth). The Mexican auto business has grown sevenfold because the Nineteen Sixties and doubled its output because the Nineties, when it was granted full entry to the US market. And very like the US, it’s been vastly centered on the interior combustion engine.

Till lately, that’s. 

As a result of, similar to within the US, the IRA appears to be inflicting important upheaval within the Mexican auto business, away from the centenary combustion engine and into the electrical automobiles and batteries which can be prone to rule the worldwide automotive market as early as the top of the last decade. Numbers are nonetheless small, however they’re rising at important charges, and this yr is poised to triple the BEV manufacturing of 2022.

Mexico’s Auto Manufacturing in 2023

Mexico produced simply over 3.5 million automobiles in 2022, a quantity slightly below Germany’s 3.677 million and South Korea’s 3.757 million. Nonetheless, placing these numbers into perspective, Mexico’s manufacturing has fallen from an all-time excessive of 4,664,779 in 2014. Although, evaluating that to Germany’s 6,146,948 automobiles produced in 2011, the nation has been closing the space with the European chief in an analogous technique to South Korea.

Of these 3½ million automobiles, solely 2% or so (79,471) had been BEVs … not a sight to behold, in all equity. But the tides are turning, and Mexico’s manufacturing strains are anticipated to triple this quantity in 2023 — over 220,000 electrical automobiles are anticipated to be produced in Mexico, as a lot as 7% of the yearly manufacturing.

And that is solely the start.

San Luis Potosí electrical car manufacturing, Picture courtesy of BMW 

So far as the general public data goes, solely two further fashions will probably be produced in Mexico this yr: the Blazer EV and the Equinox EV (each from GM). Add these onto elevated Ford Mustang Mach-E manufacturing that’s anticipated. There’s additionally presently manufacturing of some JAC EVs: the E10X (metropolis automotive), the EJ7 (a midsized sedan), the Sunray Van, and the ESei4 Professional (an SUV).

The explosion is anticipated. Nonetheless, thus far this yr, the numbers are nonetheless low, in all probability on account of Ford’s deliberate shutdown in January to extend capability for the Mach-E.

Mexico BEV Manufacturing in 2023

Behind the early months, in any case, a Tsunami is coming.

2024 & Past

Tesla’s intention to open up a plant in Nuevo León is well-known and has already been coated right here on CleanTechnica. However Tesla is way from the one automaker eyeing the Mexican lands for brand new manufacturing capability. Other than it (and Ford, and GM, which we already talked about), a number of others have proven curiosity:

• Volkswagen: In October 2022, the German automaker introduced a $763 million funding in its plant in Puebla, the place it plans to provide a number of electrical SUVs. The corporate initially mentioned that manufacturing will begin in 2026.
• BMW: In February 2023, the opposite German automaker introduced an $800 million funding in its plant in San Luis Potosí. EVs are anticipated to be produced from 2027 onwards.
• BYD: In February 2023, the Chinese language firm introduced curiosity in a Latin American plant, with Mexico being the probably candidate. No extra data has been offered as of April 2023.
• Stellantis: In February 2023, the corporate introduced a $200 million funding in its plant in Saltillo, the place the brand new RAM Promaster EV will probably be produced as early as late 2023.
• Jetour: In March 2023, the Chinese language automaker introduced a $3 billion funding for a brand new plant in Aguascalientes or Guanajuato. The plant, to be opened in 2024, will produce ICE automobiles initially, however plans on a BEV line “in two to 3 years.”
• MG: In April 2023, the Chinese language-owed British model (is it British nonetheless?) introduced curiosity in a brand new plant in Mexico. The model has had important success within the nation, being now the eighth largest model in variety of gross sales after solely two years in Mexico, and it plans to make use of Mexico as a stepping stone to get to the US market.

A few of these investments are aiming for post-2025 manufacturing dates, however I’d wager that the realities of a altering market will drive them to convey manufacturing ahead. Others (primarily the Chinese language ones, and Tesla, however surprisingly additionally Stellantis) purpose to provide in 2025 or sooner.

The Mexican EV Market

Good instances are coming, however thus far, the Mexican EV market stays small, with solely a budget(ish) JAC E10X making it into triple digits in the course of the first trimester of 2023. Whole BEV market share has a mere 0.3% of the market (which totaled 315,000 models this primary trimester).

I mentioned it earlier than and I’m repeating it now: it’s small metropolis automobiles such because the E10X that may spearhead the revolution in creating markets, at the least till worth parity is achieved within the CUV and sedan classes. Mexico stands for instance.