Mexico Beats Argentina for Brazilian Vehicle Exports

Mexico became the main trading partner of the Brazilian automotive sector in July, beating Argentina in 2023 YTD results. Brazil exports volume to Mexico are favorable because of a 33% growth in the Mexican domestic market. Brazil expanded its exports to the country by 142%, according to Anfavea.

Even with the help of increasing exports to Mexico, Brazilian exports had a significant reduction to 30,300 units, 27.6% below the same period in 2022, which totaled 41,900 units.

The Chilean market has shrunk by 30% this year, from 261,000 to 182,000 units compared to the first seven months of 2022. Purchases of vehicles made in Brazil decreased 61% in the period, from 41,000 to 16,000 units.

In Colombia, the domestic market fell by 60%, from 263,000 to 104,000 units, from January to July compared to the same period last year, and the presence of Brazilian vehicles fell 42%, from 47,000 to 27,000 units.

Mexico, on the other hand, expanded its market by 24% this year, jumping from 602,000 to 743,000 vehicles, a move in which Brazil almost doubled its sales by going from 44,000 units, from January to July 2022, to 82,000 in the same period in 2023, an increase of 89%.

Because of the performance of trade with Mexico, aided by the reduction of taxes, it was also possible to export vehicles with higher added value, such as trucks and buses. In this way the values obtained with foreign trade increased, despite the reduction in volume.

Source: Autodata / ANFAVEA     Read The Article

PSR Analysis: The results of 2019 free trade between Mexico and Brazil on vehicles and auto parts are now seen as a combination of factors, as the increase of Mexico market, Brazilian currency devaluation from 2019 to 2023 and the ability of Brazilian companies to export to Mexico.

The reduction of exports to Colombia and Chile and the increase of exports to Mexico have different mix of products and producers, that impacts the segment, OEM and model levels of PSR databases. Our quarterly updates already reflect the different mix of production forecast for 2023 onwards. PSR

Fabio Ferraresi is  Director Business Development South America for Power Systems Research

Fabio Ferraresi

Fabio Ferraresi is Managing Director, South America at Power Systems Research, where he leads regional market intelligence, consulting activities, and business development across multiple equipment segments. He holds a Bachelor’s degree in Mechanical Engineering from the University of São Paulo (USP) and an MBA in Business Management from FGV and Ohio University. Fabio also holds Six Sigma Black Belt, CMQ-OE and CQE certifications from the American Society for Quality. Prior to joining PSR in 2014, Fabio spent 13 years at Eaton Corporation in Brazil and China, where he held leadership roles including supplier development manager, supply chain manager, factory manager, and quality manager. His experience spans the automotive and industrial sectors across South America and Asia. He also serves as director at Grupo Engenho, a consulting firm focused on operational excellence and business transformation and volunteers on key committees of SAE Brazil and AEA, nonprofit organizations that support the development of policies related to the products PSR covers.

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