Global Carmakers Have Large Operations in Mexico

Donald Trump the U.S. president-elect has warned carmakers from Germany that he would impose a 35% border tax on vehicles that are imported into the U.S. from Mexico.

Trump singled out BMW the luxury carmaker for criticism after he previously has thrown barbs at Toyota, Ford and General Motors.

Mexico represents a fifth of all the production of vehicles in North America and since 2010 investment in auto plants have reached more than $24 billion, according to the Center for Automotive Research based in Michigan.

Auto assembly has been projected to double its size in the decade from 2010 to 2020 as automakers invest close to $13 billion to move over 3.4 million units of capacity to the country from Germany, South Korea and Japan.

Carmakers have been and continue to be attracted to Mexico for its unique free trade position along with its lower cost of labor.

Japan-based Nissan is the largest carmaker that operates in Mexico producing almost 823,000 vehicles during 2015. It first plant built in Mexico was five decades ago and it now produces for the most part its Sentra and Versa sedans in Mexico. It exports approximately half its Mexico output into the U.S., where it has production plants as well.

General Motors was criticized for building vehicles in Mexico by Trump while laying off U.S. workers. In 2015, GM said it was investing $350 million in Mexico to produce it latest Chevrolet Cruze as part of its investment of $5 billion in its plants in Mexico that it announced back in 2014.

Fiat Chrysler built over 503,000 vehicles during 2015 in Mexico. CEO Sergio Marchionne has said that the uncertainty over the tax and trade policies of Trump could lead many automakers to put a delay on their investments in Mexico.

Volkswagen produced over 457,500 vehicles in Mexico during 2015. VW like Nissan has had a plant for building cars in Mexico for over 50 years. It has over 16,500 employees across Mexico that built 345,000 engines during 2015.

Ford scrapped its $1.6 billion car factory planned for Mexico earlier in January and added over 700 new jobs in Michigan after being criticized by Trump. In 2015, Ford produced more than 433,750 in Mexico.

Other automakers with large-scale production in Mexico include Honda, which produced over 203,600 vehicles during 2015, Mazda with 182,350 vehicles produced in 2015 and Toyota with over 104,800 produced in 2015.

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