Mexico closed 2022 with a record in Foreign Direct Investment (FDI) in the auto parts industry, which is around 4 billion dollars, marking a growth of more than 10% compared to the previous year, as highlighted by Carlos González, CEO of Hultek, a leading Mexican company in the manufacture of rubber parts for the automotive industry.

While last year marked the start of a nearshoring process that could last several years, 2023 will be decisive in returning to pre-pandemic production levels and moving towards new technologies, such as electrification. 

Mexican companies that are part of the supply chain of the large assembly companies need to move quickly towards automated processes, quality certifications and adoption of new trends, such as sustainability and lean manufacturing, explained the manager.

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According to 2021 data from the Industry Supplier Chain in Mexico (Capim), up to 50% of the 1,500 suppliers in the automotive sector did not have the specific certifications to supply the sector. Most of these companies were found in Tier 2 and Tier 3 of the supply chain.

The Nuevo León Automotive Cluster, for example, has highlighted the need to increase the supply base by up to 3,000 additional companies that can supply the industry, while some shipowners have pointed out the need to invest up to 7 billion dollars to that existing providers moved towards electrification.

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Companies like Hultek have gone ahead to seek certifications, such as IATF 16949, as well as quality certifications that have allowed them to diversify their supply to industries such as household appliances and Oil & Gas.

The general director of Hultek concluded that the specialization and growth of the Mexican automotive supplier is not optional, since the T-MEC rules are very specific in the need for cars produced in North America to have 75% content regional.

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