People want a vehicle. And after two years of low inventories, Mexican consumers care less and less about the brand, or whether the unit is new, used or ‘chocolate’. The demand is there.
The Mexican Association of Automotive Distributors (AMDA) explains that “the lack of new vehicles”, caused by the shortage of semiconductors necessary for their production, is causing the import of used units from abroad to reach figures not seen since 2014 in the first semester of the year.
This is not necessarily good news for new or used car dealers, who for a decade have claimed that the entry of pre-owned models imported from the United States has taken a slice of their business. In 2008, so-called ‘chocolate cars’ even surpassed sales of new models.
Although automakers and their distributors have tried to get the federal government to regulate the entry of imported used cars, in 2021 President Andrés Manuel López Obrador issued a decree to regularize all cars of foreign origin that were entered the country illegally. and they lack documentation. Those interested had to pay 2,500 pesos before September of this year.
These new facilities, added to the shortage of inventory of national units, have boosted the entry of used cars. From January to July of this year, 109,285 used vehicles from the United States were imported into Mexico, which turned out to be the highest figure since 2014, when 273,256 units entered.
Compared to the same period last year, the figure meant a rise of 39% , according to the AMDA, based on data from the General Administration of Customs.
“It must be specified that these data do not include the vehicles that are being regularized through the decree that promotes the regularization of used vehicles of foreign origin. The data corresponding to this program are not regularly published in such a way that they can be consulted, so we will have to wait for the announcements made by the Ministry of Security and Citizen Protection”, said Guillermo Rosales, president of the organization.
Considering the decree by which cars that were imported without documentation, known as “chocolate”, are regularized, the figure could be higher than 800,000 units between January and July.
New geopolitical tensions prolong chip shortage
Alberto Bustamante, general director of the National Auto Parts Industry, stresses that the current tensions between the United States and China could further complicate the supply of chips, and, consequently, of vehicles.
Taiwan plays an important role in the automotive sector due to the Taiwan Semiconductor Manufacturing Company, the largest semiconductor foundry company in the world, so “if we continue with a continuous supply problem, we should be very careful,” says Bustamante.
The union organizations will request an “urgent” meeting in the coming days with the Ministry of the Interior, the Ministry of Social Security and Citizen Protection and the Ministry of the Economy, “in order to have first-hand information” about the regularization.