Coatings World - October 2011

Mexico’s Automotive Segment
Driving Paint Demand

by Charles W. Thurston Latin America Correspondent thurstoncw@rodpub.com

The Fiat 500 was recently unveiled and is only produced in Toluca, Mexico, with PPG coatings. Here PPG’s team receives an award at the Fiat 500 launch presentation.

Mexico is poised
to become one
of the Top Five
automakers in
the world.

Mexico’s automotive manufacturingin- dustry is growing robustly and an- nouncements from major original equipment and parts manufacturers indicate that billions of dollars in new investment over the short-term will help drive up demand for paints and coatings, among other component materials.

Apart from hosting the world’s largest automotive assemblers—and their paint system partners—Mexico’s national trade association, Asociacion Mexicana de la Industria Automa-triz (AMIA), estimates that there are 1,100 automotive parts companies in Mexico now. “There are certainly new plants coming into Mexico, and that is driving demand,” said Mike Millar, a spokesman for PPG’s OEM coatings unit, in Pittsburg, Pa.

Following the spike in oil prices and the de-
valued U.S. dollar, Mexico has demonstrated that
it can squarely compete with China in automo-
tive manufacturing, given its advantages of prox-
imity to the U.S. market, relatively low labor
costs, minimal language barriers and the free trade
regime established by the North American Free
Trade Agreement. Last year, Mexico’s automotive
industry racked up $87 billion in revenue on 2.3
million units. August automotive manufacturing
statistics in Mexico broke a record, with total pro-
duction up 7. 7 percent, buoyed by a domestic
sales increase of 13.1 percent, according to statis-
tics from the AMIA.