After their success in countries like Chile and Brazil, Chinese automakers are poised to increase their share of the Mexican market.
BAIC, Changan, JMC, JAC and the newcomer Chirey are increasing their sales taking advantage of the availability of models, since in China there is no shortage of semiconductors to manufacture vehicles, and because car manufacturers in Mexico are concentrated in the export marketcovering the local demand with imported vehicles.
Individually, each Chinese brand still has little market share, but adding the vehicles that automakers such as General Motors (GM) and Stellantis import from China, cars made in the Asian country already have a 16% market share, shows a analysis of the consulting firm Urban Science.
From January to August, JAC increased its sales by 121%, reaching 0.8% market share. Also, BAIC, Changan and JMC together increased their sales by 230%, to keep a 0.5% share.
MG Motors increased sales by 236% and has a 4.1% market share. It is an English brand, but completely Chinese-made, since the company was acquired by SAIC Motor.
Added to them is Chirey, which began to be marketed in the middle of the year.
Eric Ramírez, regional director of Urban Science for Latam, said that Chinese brands already have a 6% share, but if you add the cars made in China imported by other brands, the cars made in that country already have 16% of the national market.
“You don’t have to minimize them. Depending on the appetite of the market, the acceptance of the client and the incorporation of other brands, I don’t think they will reach the level of participation that they have in Chile, but together they could have 20% of the Mexican market”, commented Ramírez. Chirey commented that compared to South America, Mexicans have higher expectations of the brand and will adopt its value more if they focus on product quality.
They expand their sales in the continent
In South America, Chinese automakers are among the best sellers in Chile, Brazil, Argentina, Colombia and Peru due to the trade agreements that these countries signed with China, while in Mexico Chinese cars pay a 21% tariff to enter.
“Chery was one of the first to enter Brazil and found a local investor with 30 years of experience assembling vehicles and met the country’s requirements to assemble and avoid high import fees.
“In Chile, for years vehicles have entered from anywhere, without the need to have a plant and with zero tariffs,” explained Ramírez.
Liu Xuedong, a professor at the Postgraduate Studies and Research Division of FES Aragón, said that China exports vehicles mainly to Vietnam, Malaysia, Indonesia, the Middle East and Latin America.
“In the first eight months of 2022, the country that imported the most cars from China is Chile, but the second is Mexico,” he stressed.
This is due to the manufacturing relocation strategy of GM and Stellantis, which now make several models in China.
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