The Year in Auto 2024 China’s Impact Grows, EV Faces Challenges

The year 2024 proved to be transformative for Mexico’s automotive industry, marked by significant advancements in electromobility, strategic nearshoring opportunities, and continued growth in production and exports. As the sector adapted to new technological and geopolitical challenges, key industry players and policymakers worked together to strengthen Mexico’s position as a major global automotive hub. Below are the main highlights from the year:

Electromobility Takes the Spotlight

A key theme of 2024 was the rapid acceleration of electromobility, with electric vehicles (EVs) playing a central role in the industry’s evolution. Prominent automakers, including Ford, GM, and Tesla, unveiled new EV models and increased investments in Mexico’s production capacity. The government’s Zero-Emission Vehicles Initiative, along with Mexico’s participation in COP 29, signaled the country’s commitment to promoting sustainable transportation. At the same time, stakeholders such as the Mexican Association of Automotive Industry (AMIA) advocated for faster policy adjustments to align more closely with global green transitions.

The Growing Influence of Chinese Automakers

Chinese automakers continued to make significant strides in Mexico’s automotive market throughout 2024. BYD, which emerged as the world’s leading EV seller, stood out in the region with the launch of several new electric models. Geely’s decision to establish a presence in Mexico also highlighted China’s increasing influence in the Mexican automotive landscape. Although new tariffs on Chinese-made EVs imposed by the European Union created challenges in the global market, Chinese companies adapted quickly by altering their production and distribution strategies. This shift sparked greater competition in Mexico’s EV market, prompting local manufacturers to sharpen their competitive edge.

Cybersecurity and Workforce Dynamics

As digitalization rapidly transformed the automotive industry, cybersecurity emerged as a major concern. The number of cyberattacks targeting the sector surged by 225%, prompting a renewed focus on strengthening security measures. Concurrently, workforce dynamics shifted as major automakers like GM, Bosch, and Ford implemented job cuts, while new job opportunities were created through investments from companies such as ZF Group and MG Motor, which committed to investing US$800 million in Mexico in the coming years.

Despite these workforce adjustments, the sector continued to face challenges in attracting skilled talent, particularly in advanced technology and engineering roles. The nearshoring trend was seen as an opportunity to address this talent shortage, with increasing numbers of companies turning to Mexico for their manufacturing needs.

Record-Breaking Exports and Production Milestones

Mexico continued to set new records in automotive production and exports, strengthening its position as a leading global exporter. Despite the looming threat of tariffs, the auto parts sector experienced significant growth, driven by nearshoring trends and rising demand for electric vehicle components.

Nearshoring Fuels Regional Growth

The nearshoring trend continued to gain momentum throughout 2024, with Mexico solidifying its role as a strategic partner for automakers seeking to move production closer to the North American market. Companies like MG Motor made substantial investments, particularly in Nuevo León, where new facilities are expected to generate thousands of jobs. This shift not only bolstered Mexico’s manufacturing capabilities but also helped mitigate risks related to trade tensions and supply chain disruptions.

As the year comes to a close, Mexico’s automotive industry stands at a critical juncture. With the ongoing expansion of electric vehicle production, the rise of Chinese automakers, and the growth of nearshoring, the sector is well-positioned to capitalize on emerging trends. However, challenges such as cybersecurity, workforce transitions, and supply chain issues will remain key areas of focus for industry leaders. As Mexico continues to solidify its status as a global automotive hub, the coming years are poised to bring further transformation and opportunity to the sector.