EconomyFinancialConsultations on energy matters against Mexico worry the automotive...

Consultations on energy matters against Mexico worry the automotive sector

Not only companies in the energy sector are keeping an eye on the path that the consultations under the TMEC promoted by the United States and Canada on Mexico’s energy policy will take. Vehicle manufacturers are also interested in the topic because the use of alternative energies in their production processes is one of the pillars of their global decarbonization strategies.

The Mexican Association of the Automotive Industry (AMIA), which represents the more than 20 assemblers installed in the country, and the National Auto Parts Industry (INA), described as “worrying” the policies of the Mexican government on the generation of energy under private schemes, mainly those aimed at renewable energies, since this limits the possibilities of companies in the sector to comply with international environmental commitments , which could affect the dynamism of the sector in the short and medium term .

“The assembly companies have a global commitment, from 2035 to 2050 they will not only change technologies (combustion engine for electrification), but also for the manufacture of all cars they must use clean energy… Mexico requires sufficient clean energy, available and at competitive prices, it is fundamental”, he stresses.

Mexico ranks seventh worldwide as a producer of light vehicles, behind countries such as China, the United States and Japan, among others.

The same worrying environment extends to auto parts manufacturing. Francisco González, executive president of the National Auto Parts Industry (INA), highlights that the adoption of clean energy in its production schemes is a change that must be made, as it is a determining part of the sector’s value chain.

Mexico is the main producer of auto parts in the United States and number one in Latin America . In the first half of the year, the value of auto parts production amounts to around 52,477 million dollars.

Both the United States and Canada accuse “discriminatory treatment” towards the energy companies of said countries to participate in the sector of storage, import and marketing of fuels, as well as the generation of energy under private schemes, in favor of the state electricity company of Mexico, the CFE, and the state oil and gas company, Pemex.

González adds in an interview with Expansión that, although the energy dispute is still in the consultation process, this could go beyond a panel, which could culminate in the imposition of tariffs on various Mexican products – such as cars or some agricultural products. – and, in the medium term, generate an “environment of negativity” for investments, due to the environmental commitments acquired by economic agents at a global level.

The other disagreement between the partners of the T-MEC

Consultations on energy matters are not the only disagreement between Mexico, the United States and Canada at the moment. On January 6 of this year, the Government of Mexico, through the Ministry of Economy, requested the formation of a Dispute Resolution Panel under the T-MEC scheme, after not having reached any agreement after holding consultations with what is established in Article 31.4 of the commercial agreement. In this, the issue in question is the Regional Value Content and the interpretation of the rules of origin , essential for the imposition of tariffs.

Both the AMIA and the INA hope that the resolution of this panel will arrive between October and November of this year, and that it will favor the position of Mexico and Canada.

Zozaya points out that “we must take care” of the relationship with neighboring countries to the north, mainly with the United States, since it is where nearly 90% of the total production of the sector is exported.

“Strange interpretations (by the Mexican government in energy matters) are not valid, because that is exactly what we are demanding from the United States on the issue of Regional Content Value. Now we intend to do it on the energy issue, and we have to handle this issue carefully. We trust, hopefully, that Mexico’s position is in accordance with the terms of the T-MEC and this does not even reach the establishment of a panel, “he argues.

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