Mexico, one of the biggest exporters of vehicles in the world, experienced a 12.7% drop in total vehicle exports in August from a year ago.
Manufacturers shipped 281,811 units last month compared to 322,779 vehicles in August 2018, according to the Mexican National Institute of Statistics and Geography (INEGI) and the Mexican Association of the Automotive Industry (AMIA).
Year-to-date, auto production is down almost 1% to 2.6 million units, but exports are up 1.5%.
AMIA President Eduardo Solís Sánchez said the decline is partly due to lower demand from the U.S., Canada and Brazil, which represent 90% of Mexican auto exports.
"There are brands that have indicated changes in their production lines [Nissan and Mazda] and others that after a drop in demand for the models have had to make adjustments. Even [Honda] said publicly that it will close a shift because of the low demand it is having for its HR-V model," Solis said during a press conference, according to Automotive News Mexico.
Mexico's exports of cars dropped sharply across several car makers in August, compared to the same period last year, according to INEGI. Global car companies with manufacturing plants in Mexico include Ford Motor Company (NYSE: F), Honda Motor Co (NYSE: HMC), Fiat-Chrysler Automobiles (NYSE: FCAU), Toyota Motor Co (NYSE: TM), BMW, General Motors Company (NYSE: GM), Kia, Mazda, Nissan, Volkswagen, and Audi.
FreightWaves SONAR data shows carloads of motor vehicles and parts coming from Mexico via rail (SONAR: RTOMV.MEX) has dropped around 17% from a peak on June 29.
Mazda, which makes the Mazda3 model at a plant in Salamanca, Mexico, reported that its export volume fell 66% in August.
Audi, which produces its Q5 crossover vehicles in San José Chiapa, had export declines of 61%.
Volskwagen's exports from Mexico fell 38% in August year-over-year; FiatChrysler Automotives Mexico declined 32% and Kia exports declined 23%.
Solis said while exports of cars manufactured in Mexico for the U.S. market fell during August, sales of cars manufactured in Mexico in the U.S. increased 10.5%, with 1.6 million units sold compared to 1.5 million sold units in August 2018.
Not all the news was bad for the Mexican automotive industry. Ford, Nissan and Honda reported increases in exports from its Mexico plants for the month of August.
Ford, which has three plants in Mexico, reported vehicle exports increased 24.5% for August.
Nissan, which has plants in Aguascalientes and Cuernavaca, reported a 0.8% increase in exports for cars such as the Versa.
Honda reported a 293% increase in exports of its Mexican-made vehicles for August, compared to last year. But the numbers were skewed by a flood, which shut down the automakers plant in Celaya in August 2018.
While exports of Mexican-made vehicles were mostly down for August, exports of auto parts remained strong, officials said.
Óscar Albin Santos, executive president of the National Auto Parts Industry in Mexico, said that the auto parts sector is expected to grow 3% in terms of both production and exports this year.
Santos also said that ratification of the United States-Mexico-Canada trade agreement is crucial to give the automotive industry certainty for making future investments. Mexico ratified the USMCA in June, but it is currently stalled in the U.S. Congress.
Image Sourced from Pixabay
See more from Benzinga
- FreightWaves Radio Preview: Discussing The AB5 Law And Its Impact On Trucking
- Canada's Fastest-Growing Transport And Logistics Firm Pushes Into US
- Radiant Logistics Caps Off Record Year Still Looking For Acquisitions
© 2019 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.