Mexico Becomes Second Largest Market for Chinese Cars

Chinese cars are becoming increasingly popular in Mexico, so much so that the country is now the second-largest market for Chinese cars only behind Russia.

You don’t need to go back deep into history, back in 2016 Chinese cars were just about a fraction of the Mexican market and were considered a rare sight. Now within just 7 years, Chinese cars enjoy a 20% share of the market and the number is expected to increase further. Sales data reveals that the penetration rate of Chinese cars (most of which are exported to Mexico) is higher than those manufactured in any other country of the world, including Mexico.

Data from the Mexican Association of Automotive Distributors (AMDA) shows that Chinese car sales in Mexico increased by 51% in the first 10 months of this year with 212,169 units. Every other foreign country is selling less than half that to Mexican consumers, AMDA data reveals.

According to data from the China Association of Automobile Manufacturers (CAAM), Russia is currently the largest export destination for cars made in China and is followed by Mexico in second place. There are a couple of factors behind such a surge, first due to the significant shift in Chinese consumer preferences toward electric vehicles, domestic automakers now have more gasoline-powered vehicles available for export.

Secondly, while this was going on, supply chain problems caused by COVID-19 halted the production of automobiles from other brands and drove up prices, giving China’s Chery, JAC, SAIC, BYD, and other companies an opportunity to enter the market with less expensive models.

In addition, China has focused on improving manufacturing quality, and its models are considered to have more advanced technology for the price, says Carlos Alvarado, vice president and strategic adviser for Grupo Prodensa, a Monterrey-based consultancy for foreign investors in manufacturing. Carlos goes on to add:

“It no longer scares us that the product is made in China. Every other high-tech product is made in China, like iPhones.”

For example, a car buyer Jorge Ramirez Robledo when he went to buy a new pickup in October, encountered an enticing option in the shape of JAC Frison T8 priced at 468,000 pesos ($27,317). It costs about $10,000 less than similar trucks from Chevrolet, Ford, and Toyota. After inspecting the vehicle, and its engine, and peeking inside its spacious leather interior with an HD touchscreen, Robledo was impressed with what the vehicle offered for its price. Plus it had a 5-year warranty, so he ditched the well-known names in favor of a value-for-money offering from a Chinese brand.

According to Robledo, all Chinese brands offer greater technology at a lower cost. And he went on to reveal that it was his second Chinese vehicle; as he already owns an MG.

UsmanAnsari

A computer animation professional with over 23 years of industry experience having served in leading organizations, TV channels & production facilities in Pakistan. An avid car enthusiast and petrolhead with an affection to deliver quality content to help shape opinions. Formerly written for PakWheels as well as major publications including Dawn. Founder of CarSpiritPK.com