Doing Business in Mexico: Automotive Industry
Even though during the last crisis the automotive industry was seriously affected, and as a result of the natural process of adaptation, many groups faced serious restructures and restricted budgets in the last two years, the automotive industry is back and holds its place among the most emblematic and representative industries in the world economy.
The recovery does not mean that things will go back to how they were before. On the contrary, if the industry managed to make a comeback after the crisis, it was due to severe adjustments in different key aspects, such as the production capacity, restructuring the organization and mainly changing the focus of the business model of the large European, Asian and particularly North American automotive corporations.
In relation to the markets, the most significant change is evidently, the end of the hegemony of North American Automotive Industry, which was surpassed by Japan first and now by China, as the world’s largest vehicle manufacturer in 2010, however, in 2011 North America Automotive Industry was the second largest vehicle manufacturer. Other changes can also be attributed to technological advances, which have made possible to improve the performance of internal combustion engines, introduce new lines of vehicles with electric or hybrid engines, and to the gradual trend of the large car manufacturers towards smaller size vehicles and designing unified construction platforms that allow for greater flexibility in producing different vehicle models at the same time and for a significant reduction in manufacturing and assembly costs.
But the most encouraging news for countries located below the Tropic of Cancer, is the new and most significant role that those emerging countries will take in the strategic world, either through local companies (China and India), or hand-in-hand with the large global automotive corporations, as in the case of Mexico, Brazil and other countries in Latin America.
Source: Global Automotive Industry News