Sun, Dec 29, 2024 page9

• Chinese-made vehicles grab Mexican market share

  • By Yussel Gonzalez / AFP, MEXICO CITY
  • • 
    • 
    • 

  The growing popularity of Chinese sport utility vehicles and pickup trucks has shaken up Mexico’s luxury car market, hitting sales of traditionally dominant brands such as Mercedes-Benz and BMW.

  Mexicans are increasingly switching from traditionally dominant sedans to Chinese vehicles due to a combination of comfort, technology and price, industry experts say.

  It is no small feat in a country home to factories of foreign brands such as Audi and BMW, and where until a few years ago imported Chinese cars were stigmatized, as in other parts of the world.

  

  A Chinese-made Haval H6 SUV travels on Reforma Avenue in Mexico City on Monday.

  Photo: AFP

  The high-end segment of the market registered a sales drop of 8.1 percent from January to last month, the Mexican Association of Automotive Distributors (AMDA) said.

  Audi’s sales slumped by 21.9 percent, while BMW, which includes the Mini brand, saw no growth in Latin America’s second-largest economy, home to 129 million people.

  Mercedes-Benz had a 9.8 percent decline, according to the state-run statistics institute INEGI.

  In contrast, Motornation, which sells the Beijing Automotive Industry Corp (BAIC, 北京汽車工業), JMC (江鈴汽車) and Changan (重慶長安汽車) brands in Mexico, saw an 8.8 percent increase in sales in the first 11 months of this year, while those of Jetour (捷途汽車) rose 131 percent, it said.

  Chinese firms now control 9.3 percent of the Mexican market, according to the AMDA.

  They have brought stiff competition to the pickup truck segment, with many of the features of high-end models offered by premium brands, association president Guillermo Rosales said.

  Traditionally, the premium segment included sedan-type vehicles with luxury engines and top-of-the-range features.

  However, over the past decade consumer preferences have shifted toward utility vehicles such as pickup trucks, minivans and SUVs.

  Asian brands also benefited from an exemption from import tariffs on electric vehicles that was in effect in Mexico from 2020 until Oct. 1.

  As in other Latin American countries, Mexicans are becoming more used to seeing Chinese brands on the streets that were unknown to them until about five years ago.

  Miguel Reyes, a 71-year-old retiree, said that choosing a Chinese car over others was “simple arithmetic.”

  “I needed a car that had the necessary technology, such as steering assist, to make driving safer,” Reyes said.

  As well as the design and comfort, the “competitive” price was another factor, said Reyes, who paid about 550,000 pesos (US$27,057).

  A similar model from a traditional brand would have cost him US$40,000 to US$50,000, he said.

  There are about 30 Chinese brands in Mexico, with vehicles ranging from compacts to luxury cars, said Gerardo Gomez, an expert at the data and analytics company J.D. Power.

  “They can offer you anything at any point in the range,” Gomez said.

  BYD (比亞迪) offers an electric pickup truck for more than 1 million pesos, but also a compact car for US$17,000.

  Zeekr (極氪智能), a premium electric brand, sells luxury models for about US$40,000.

  Chinese cars’ growing presence in Mexico, which is itself a major exporter of vehicles, comes at a time when China is a source of contention between the US, Mexico and Canada, partners in a regional free trade agreement.

  During his campaign, US president-elect Donald Trump suggested that China was building car factories in Mexico to sell vehicles in the US.

  Canadian officials have accused Mexico of being a springboard for Chinese products in the region — a claim denied by Mexican authorities.

  Trump has also threatened to impose 25 percent tariffs on Mexico and Canada unless they stop flows of migrants and drugs.

  Only 7 percent of the components of cars manufactured in the Latin American country are Chinese, Mexican President Claudia Sheinbaum said.

  “There’s no evidence from anywhere that proves that Mexico is being used as a springboard” for Chinese products, said Diego Marroquin, a trade policy specialist at the Wilson Center in the US.

  “It’s a political narrative that comes from the United States and now from Canada,” Marroquin said.

  Sheinbaum last month said that she would propose to the US and Canada a Chinese import substitution plan, adding that in the case of Mexico alone, the trade deficit with the Asian giant amounted to US$80 billion.
• Most Popular

  • 1

    Taiwanese lose status after obtaining single-use Chinese passport

  • 2

    KMT chair to meet with Xi, but at a price: source

  • 3

    Deterring Taiwan conflict a priority: US

  • 4

    Taiwanese tourists go viral in video during Japan quake

  • 5

    US vows deterrence ‘through strength’