Coronavirus threatens Mexican auto industry

While the coronavirus itself has not yet spread widely in Mexico, the Mexican auto industry is likely to fall prey to the disease that is currently making headlines.

That the Mexican car industry sees a major threat in the corona virus has everything to do with Chinese suppliers. In China, almost everything is in the hole right now, and so do the factories that build parts that are vital to the massive Mexican auto industry. Manuel Conzalez, minister of economic development in the Mexican state of Aguascalientes, tells Reuters that many factories are already nearing the end of stock. “The factories tell me they have stock until the second or third week of March,” he said.

This means there is a good chance that a number of factories will soon find themselves forced to close the doors until further notice. That is bad news for Mexico, which is not doing very well economically anyway. It also gives rise to fears for US sales, as 80 percent of Mexican production disappears to its powerful northern neighbors.

With more than four million vehicles produced, Mexico still ranked sixth in the list of largest auto-producing countries in 2018, although fewer cars were already built in 2019. GM, FCA, Nissan, Ford, Kia, Toyota, Honda and Mazda have factories in the Central American country, as well as the European brands Volkswagen and Audi. BMW was added to the list in 2019 and is now building the 3 Series in Mexico, among others.

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