Why this is important to Wisconsin businesses: Wisconsin companies in the automotive or tire industry could support Mexico’s expanding role in those sectors by supplying technology and equipment.
The automotive industry is rapidly gaining ground in Mexico. Tesla is the latest automaker to join the trend, announcing in February that it will build a manufacturing plant near Monterrey.
Martha Delgado, a Mexican deputy foreign minister, told Milenio Television the investment was worth “in excess of $5 billion,” and that Tesla would produce about 1 million vehicles a year at the new facility.
Mexico already is the seventh-largest vehicle manufacturer in the world, producing more than 3 million vehicles a year—about two-thirds of them exported to the U.S.—according to World Population Review.
Mexico has 20 vehicle assembly plants currently operating, according to Reuters. The automakers include General Motors, Ford, Toyota, Honda, and Nissan.
The auto industry generates 3.5% of the country’s total gross domestic product (GDP) and 20% of its manufacturing GDP, and employs more than 1 million people nationwide, according to the U.S. Department of Commerce’s International Trade Administration (ITA).
Mexico also is the world’s sixth-largest heavy vehicle manufacturer, with 11 factories that assemble buses, trucks, tractors, and engines, and employ more than 18,000 people, ITA says.
In addition, Mexico is the world’s leading exporter of tractors, with nearly 95% of its products delivered to the United States.
With so much vehicle manufacturing, the tire industry is also strong in Mexico. The off-the-road tire market was valued $989 million in 2020 and is expected to increase at a compound annual growth rate of 8.1% over the next five years to reach $1.6 billion by 2026, according to TechSci Research.
Six tire manufacturers have a total of nine tire factories in Mexico, according to BlueWeave Consulting.
Wisconsin companies involved in the auto or tire industries may find opportunities for partnerships in Mexico.
