The United States and Germany were placed as the main destinations for car exports from Mexico in 2021, according to data from the Ministry of Economy.
In general, all Mexican exports of these vehicles were 37,374 million dollars last year, which represented a year-on-year decrease of 7.7% and a drop of 26.6% compared to the level of 2019.
Mexico is a competitive producer in the automotive industry, with high production shared with the United States and Canada.
In particular, car exports from Mexico to its northern neighbor totaled 25,326 million dollars in 2021, a contraction of 12.6% at the annual rate and a decrease of 31.7% when compared to 2019.
By contrast, shipments to Germany posted 11.4% year-over-year growth in 2021, to $4,827 million, and 9.7% above 2019.
The United States and Mexico have a strong economic and trade relationship that was reinforced by the North American Free Trade Agreement (NAFTA).
From 1994 until the entry into force of the Treaty between Mexico, the United States and Canada (USMCA, substitute for NAFTA) on July 1, 2020, NAFTA eliminated practically all tariff and non-tariff trade and investment barriers between countries and provided a rules-based mechanism to govern North American trade.
Congress included $180 million over four years in the USCMA’s implementing legislation for technical assistance projects related to the agreement and $30 million to pay for labor attachés and other staff to monitor Mexico’s USMCA compliance.
The goals of recent assistance have been to ensure compliance with Mexican labor laws and legitimate collective bargaining rights; increase measures to mitigate Covid-19 among workers; and address child labor and forced labor in Mexico’s supply chains, including in agriculture.
Some members of Congress have praised two recent votes by Mexican workers in favor of establishing independent unions at their auto plants as steps to improve worker rights and representation.
Other relevant destinations for car exports from Mexico were Canada, with 2,334 million dollars (2020: 2,408 million and 2019: 2,994 million); Colombia, with 547 million (2020: 405 million and 2019: 552 million), and Brazil, with 398 million (2020: 279 million and 2019: 854 million).