Mexico Auto Parts Manufacturing Market Report and Forecast 2024-2032

Mexico Auto Parts Manufacturing Market Outlook

The Mexico auto parts manufacturing market size is projected to grow at a CAGR of 3.6% between 2024 and 2032. The market is being driven by the increasing foreign direct investments in the Mexico automotive sector.

Key Takeaways:

• Mexico is the 4th largest producer of auto parts in the world.

• Passenger cars are expected to constitute a major portion of the Mexico auto parts manufacturing market share.

• The demand for electric vehicle batteries is expected to increase significantly in the Mexico automotive market.

The resilient supply chain network for automotive parts in Mexico has prompted various international companies to relocate their operations to the country. Mexico is a key destination for Japanese foreign direct investment (FDI) and received a cumulative amount of $29.8 billion between 1999 to 2021, with the key investments being concentrated in the state of Guanajuato. This is prompting the Mexico auto parts manufacturing market expansion.

The United States-Mexico-Canada (free trade) agreement has set the minimum regional content requirement for automotive manufacturing at 75%, which is also expected to accelerate the Mexico auto parts manufacturing market growth.

The global shift towards electric vehicles is expected to result in significant development of the auto parts manufacturing market in Mexico. In February 2023, global automotive giant BMW announced an investment of $866 million in San Luis Potosi to manufacture high-voltage electric vehicle batteries and produce Neue Klasse car models. Increasing investments in new vehicle technologies is one of the key Mexico auto parts manufacturing market trends.

By 2030, Mexico is expected to account for more than 60% of the demand for electric vehicles in Latin America, which is expected to further drive the Mexico auto parts manufacturing market growth. An increasing number of American and European companies are nearshoring their operations to Mexico to benefit not only from high consumer demand but also from reduced production and operational costs, further driving the market expansion.

Market Segmentation

Mexico Auto Parts Manufacturing Market Report and Forecast 2024-2032 offers a detailed analysis of the market based on the following segments:

Market Breakup by Component Type

• Battery

• Cooling System

• Underbody Components

• Engine Components

• Automotive Filter

• Lighting Components

• Electrical Components

• Others

Market Breakup by Vehicle Type

• Passenger Cars

• Light Commercial Vehicles

• Heavy Commercial Vehicles

• Others

Market Breakup by Sales Channel

• OEM

• Aftermarket

Market Breakup by Region

• Baja California

• Northern Mexico

• The Bajío

• Central Mexico

• Pacific Coast

• Yucatan Peninsula

Key Mexico auto parts manufacturing market players are engaged in upscaling their production capacities to meet the growing demand for electric vehicles in foreign markets and benefit from the low cost of operations in Mexico.

The key market players are Robert Bosch GmbH, Continental AG, Schaeffler AG, Marelli Holdings Co., Ltd., ZF Friedrichshafen AG, Aisin Corporation, Hyundai Motor Group, Valeo SE, YAZAKI Corporation, and Akebono Brake Industry Co., Ltd., among others.

Key Highlights of the Report