Mexico Auto Parts: Leading the Automotive Industry in 2024

The2023, the global auto parts industry was led by China with a production value of $500 billion, followed by the United States at $286 billion, Japan at $180 billion, and Mexico at $120 billion.

This performance underscores the importance of the Mexico auto parts sector as a key player in the global supply chain and a major contributor to the automotive industry in Mexico. The Mexican automotive industry continues to be a cornerstone of the national economy, driving growth and employment.

Alberto Bustamante, General Director of the National Agency of Automotive Sector Suppliers (ANAPSA), emphasized that Mexico is on track to surpass Japan and claim its position as the world’s third-largest auto parts manufacturer in the near future.

Growing Production and Economic Impact

ANAPSA estimates that the Mexico automotive industry will reach a production value of $127 billion by the end of 2024. If this upward trend persists, Mexico is poised to surpass Japan, solidifying its role in the global market as a leading hub for car manufacturing.
According to Bustamante, this growth is fueled by Mexico’s strong manufacturing sector, which has effectively integrated into North American supply chains through agreements like the USMCA.

The industry supports over one million direct jobs, representing 22% of the nation’s total employment. Among these, 102,000 positions are within OEM plants, while the production of trailers and auto parts adds 900,000 additional jobs. These roles not only provide competitive wages but also continue to draw automotive manufacturers from across the globe.

Regional Contributions to the Auto Industry

The diverse contributions of Mexico’s regions highlight the breadth and strength of the country’s auto industry:

The Central-Bajío region has become a dominant force in the automobile industry, surpassing the northern region in vehicle production. This area is particularly strong in manufacturing light trucks and electric vehicle (EV) components, showcasing Mexico’s ability to adapt to evolving global demands and maintain its competitive edge.

Integration with the North American Market

The North American market remains a cornerstone for Mexico auto parts, with the United States importing 43% of the country's production. These exports play a critical role in maintaining Mexico’s position as the largest exporter of auto parts in the Americas. Among the most significant components are electric vehicle (EV) parts, wiring harnesses, transmissions, engines, suspensions, and textiles.

Bustamante highlighted the strategic advantages of Mexico’s location and trade agreements like the USMCA, which have optimized logistics and strengthened relationships with global automotive manufacturers.
These factors have established Mexico as a prime destination for investment in vehicle production, further cementing its leadership in the global automotive market.

The Rise of Electric Vehicles and Sustainability

The shift towards electric vehicles (EVs) presents new opportunities for Mexico’s auto industry. The country is actively diversifying its offerings to meet the growing demand for EV components. This includes battery packs, electric motors, and charging infrastructure, further integrating Mexico into the future of global vehicle production.

As EV adoption increases, Mexico’s auto parts industry is poised to capture a larger market share by supplying innovative and sustainable components. This shift aligns with Mexico’s goals to remain competitive in the evolving global automotive landscape.

Challenges and Future Outlook

Despite its impressive growth, the Mexico automotive industry faces challenges, including supply chain disruptions and competition from other regions. However, Mexico’s strategic location, skilled workforce, and established manufacturing sector continue to attract automotive manufacturers and investors.

By maintaining its focus on quality, innovation, and sustainability, Mexico is well-positioned to secure its place as a leader in the automotive industry and achieve its goal of becoming the world’s third-largest auto parts manufacturer.

Discover how Mexico's auto parts industry is driving innovation and leading the global automotive market in 2024. Ready to explore opportunities for your business? Contact us today and let’s drive your success together!