New Industry Group Targets 100% BEV Adoption in Mexico

MEXICO CITY – A new automotive industry association in Mexico is targeting making all car and utility-vehicle sales in the country 100% battery-electric vehicles by 2035, boosting Mexican production.

The Electro Movilidad Asociación (EMA) (https://emasociacion.org) is looking to persuade the Mexican government to deliver the changes to public policy and large investments in charging infrastructure that are needed for such a major change.  

It has been formed by companies including Volvo, Tesla, China’s JAC Motors and BYD, Mexico’s SEV (which sells Chinese BEVs) and Latin America and Caribbean auto charging company Evergo (pictured, below left).

Its president, Shirley Wagner, said in March that the EMA would pursue the reduction of emission pollutants, regulation that increases BEV adoption in Mexico and better education on electromobility, while boosting the development, installation and operation of charging infrastructure for electric vehicles.

“We call on all interested parties to share the best international practices to contribute to a better development of electromobility and bring its benefits to all Mexican cities,” she tells a press conference. 

EMA also will promote the conversion of high-mileage vehicle fleets, including corporate vehicles and taxis. And it will become a source of statistics on the BEV industry in Mexico. Crucially, says Wagner, the association has secured a commitment from its members to increase their investments in Mexico. 

In a note to WardsAuto, EMA says its “intention is promoting, in collaboration with different relevant entities, electromobility in Mexico to achieve the goals of having 50% of new-car sales be (B)EVs by 2030 and 100% by 2035, in line with what is happening in other countries.

“We believe that those of us living in Mexico deserve cleaner air, and it is possible to achieve it if we work together to make previously made commitments a reality.” 

EMA’s goals, however, have been criticized as overly ambitious by existing Mexico auto industry associations AMIA (Asociación Mexicana de la Industria Automotriz) and AMDA (Asociación Mexicana de Distribuidores de Automotores).

“Talking about 100% in the domestic market implies too many challenges...In the period of which we speak (up to 2035) we have forecasted a 20% (BEV) participation in the domestic market,” says Cristina Vázquez, head of economic studies at AMDA.

An existing Mexican association promoting BEVs (AMIVE – Asociación Mexicana de Impulso al Vehículo Eléctrico), has, however, said Mexico is Latin America’s most prolific producer of BEVs, making 106,180 units in 2023 according to AMIA data, and is the seventh largest BEV producer worldwide, according to AMIVE.  

But for comprehensive adoption locally, cementing Mexico’s position as a key Latin American supplier, Mexico has a long way to go, says AMIA. According to a 2023 AMIA report (https://www.amia.com.mx/wp-content/uploads/2023/10/ExecutiveSummary.pdf), only 20% of car sales in Mexico will be BEVs by 2030. And it says that even if the Mexican government adopts “a comprehensive policy to promote electromobility, the penetration of said vehicles can increase to 38.9% of total light vehicle sales in Mexico by 2030,” far from EMA’s 100% goal. 

Chevrolet Equinox BEV produced at GM's Ramos Arizpe, Mexico, assembly plant.

Consultant Thomas Karig, a former vice president of corporate relations and compliance officer at Volkswagen, agrees with AMIA, although he believes the Mexican government should actively promote and support BEV sales.

“If the Mexican government does not incentivize the purchase of (B)EVs, there will not be high-volume sales,” he tells WardsAuto, “U.S. regulations force automotive companies to sell a certain percentage of (B)EVs to reduce emissions. This does not happen in Mexico. In a nutshell, (B)EV sales will happen when they are cheaper than internal-combustion-engine cars.” That can come through consumer incentives patterned after those in the U.S. Inflation Reduction Act, he says. 

Meanwhile, EMA member BYD says the government should also stimulate BEV development by supporting the availability of recharging infrastructure and related reliable power supplies: “Incentives are finite, and it has been proven that there will be no institution or government willing to annually invest a big part of its budget in incentives for this technology,” the company says. Rather, the government should actively promote “new business models generated by this technology of which BYD is a worldwide leader.”

Figures from EMA itself also indicate how its goals will be tough to achieve; its members sold only 40,275 BEVs in Mexico in 2022 out of nearly 55,167,421 registered vehicles in the country that year. 

Brian Irwin, managing director with Alvarez & Marsal’s Automotive & Industrials Group, in Detroit, says BEVs account for 1% of the Mexico auto market at present, less than the 9% in the U.S.: “I think it is an onerous task ahead to drive the level of adoption that’s required,” he tells WardsAuto: “A hundred percent is a challenging number. It is fine to set an objective, but to say 100 percent of the car parc will be electric – that would only occur if you passed legislation that makes it impossible to sell ICE vehicles.” 

Charging infrastructure is also deficient, with only 32,175 chargers installed around Mexico, according to EMA numbers. 

“Without resources from the government to build the charging network and support the purchase of (B)EVs, Mexico will have to wait until prices decrease and the market provides the charging infrastructure, and that can take several years. There is no way of forecasting when that will be,” says Karig. 

BYD adds that “the client perception on (B)EVs” remains problematic in Mexico: “(B)EVs are not only to travel within cities but between them,” the Chinese automaker says. “Charging infrastructure will help eliminate the paradigm that points to (B)EVs being only for short trips. The creation of electric (charging) corridors is a must-have element.” 

EMA will need to demonstrate with solid figures that charging availability has changed to increase consumer demand, Irwin says.

“Just painting a rosy picture is not going to get you there,” the consultant says, adding that for the Mexican market, “That charging infrastructure must be affordable.”