The automotive industry in Mexico is going right

The implementation of USMCA will have a positive impact on the auto parts industry

A lot has happened in the past three months. A pandemic came and changed the course of global economy, companies started to leave centralized supply chains in Asia in favor of a regional supply chain model, and the USMCA was finally implemented. Even with all this on top, it has actually had quite a positive impact on the automotive industry in Mexico.

Without a doubt, it has not been perfect. Auto part manufacturers are still on their way to reinventing their processes to better implement new technologies and cover the new demand volume. Yet, even with the COVID-19 negative effects still being felt, the projection of the automotive industry in Mexico is a positively disruptive one.

“Just as the pandemic struck, we could see how Mexico can become ‘a winner’ due to how close it is to the biggest auto parts manufacturers, such as the USA, and being one such a manufacturer, like Canada. In other words, we don’t need to cross an ocean (to trade with them).

There is an important lineup with the treaty (USMCA), without a doubt, these treaties are important, especially in these circumstances,” said Miguel Fonseca, Capgemini Business Transformation director in an interview with Forbes.

This disruption comes with its own set of challenges that the automotive industry in Mexico needs to overcome so it can top all the negatives it had. One of these is adopting the new technologies needed to enter industry 4.0.

Nevertheless, the automotive industry in Mexico has been quite lucky in 2020. As stated before, the pandemic cut Asian-centered supply chains. It gave companies with regional supply chains an edge over those who depended on their main manufacturing plant in China.

Mexico, due to it being quite the midpoint between North and Central-South America, quickly became a hotspot for companies to adopt it as it’s American regional supply chain. The USMCA only makes the deal sweeter.

Setting shop in a country that has such a prosperous automotive industry is important for any auto parts manufacturer. Thus, here at VYNMSA we would like to assist you in settling in Mexico.

We’re also fully equipped to assist you in developing your BTS projects, with lease and sale solutions that always have a win-win approach.

Contact us and set shop in Mexico with VYNMSA where the projection for the automotive industry is very positive.

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