Mexico’s $100-Billion Auto Parts Industry is Reinventing Itself for the EV era (Rest of World)

Mexico is the world’s fourth-largest exporter of auto parts. Thousands of parts manufacturers have emerged in the country to support the massive auto conglomerates that build their cars there — companies like GM, Ford, Kia, Audi, and Hyundai. In 2022, Mexico’s auto parts manufacturing was valued at $106.7 billion; for comparison, Mexico’s completed vehicle exports were estimated at $165 billion in the same year. Auto parts manufacturing employs roughly one million people, with over 12% being directly involved in the production of combustion engines — the jobs most likely to be immediately affected by the EV transition.
Gaining expertise in parts manufacturing for electrical motors will be a challenge, according to German Carmona Paredes, who teaches mechanics and energy at the Engineering School in Mexico’s National Autonomous University (UNAM). He is worried that the local industry will struggle to adapt to the high tech required by EVs. “The biggest challenge for Mexico has to do with batteries, electronics, and electrical motors,” he told Rest of World, noting a large percentage of these components are chiefly made in China and are exported to Mexico just for assembly.