In recent times, Chinese electric vehicle manufacturers have witnessed remarkable growth in Mexico’s automotive market, especially within the realm of electric vehicles (EVs). This surge is largely due to their emphasis on affordability, a factor that has strongly resonated with consumers.
Since the introduction of the Chinese brand JAC’s E10X to the Mexican market in November 2021, this particular EV model swiftly emerged as the most cost-effective option available nationwide. Its popularity quickly elevated it to become the best-selling EV model in the country.
The key to the success of Chinese brands in Mexico’s EV market lies in their unwavering focus on the balance between cost and value. For instance, JAC’s vehicle, offering an impressive range of 360 kilometers per charge, is remarkably priced at 439,000 pesos.
China’s achievement in this domain is a result of successfully harmonizing mass production of EVs with efficient manufacturing costs, a challenge that manufacturers from Europe and the United States are yet to fully address.
Before the influx of Chinese-manufactured EVs, the Mexican market mostly saw EVs priced around the million-peso range, such as the Nissan LEAF at 922,900 pesos, Chevrolet Bolt EUV at 989,400 pesos, and the Ford Mustang Mach-E starting at a substantial 2,092,000 pesos.
Eric Ramírez, Director for Latin America at Urban Science, explains, “We’re witnessing the emergence of different market segments, and I see Chinese vehicles as a potential catalyst for technology democratization. Chinese manufacturers have taken a pioneering lead in battery production, significantly reducing costs.”
Recent developments include the introduction of SEV’s subcompact E-WAN Cross, manufactured by the Chinese firm Dayun. This model, available in the Lite entry version priced at 379,900 pesos, offers an impressive range of 330 kilometers.
China’s supremacy in lithium battery production remained unchallenged by the end of 2021, commanding a staggering 79% of the global production, as per Statista’s data. Projections indicate this dominance will continue for the foreseeable future.
While China’s lead in lithium-ion battery production is set to continue, European countries are anticipated to significantly expand their production capacities in the coming years.
Leading the global battery production landscape is China’s state-owned enterprise CATL, which, by the end of the previous year, claimed a 37% market share, according to SNE Research. The EVs marketed by JAC and SEV in Mexico rely on CATL batteries. South Korea’s LG Energy Solutions follows closely with a 13.6% share.
Despite Mexico not yet tapping into lithium extraction or EV battery manufacturing, De Luna Lithium Battery aims to be the pioneer in producing these components. The company plans to leverage technology and raw materials from China, which already boasts a highly efficient and economical battery industry.
Giovanni De Luna, CEO of the Mexican firm, explains, “China’s well-established battery industry holds a unique economic advantage over counterparts globally.”
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