GM Mexico Could Reduce Imports, Boost Local Production

that GM is said to be in talks with Taiwanese tech firm Foxconn to produce goods in Mexico rather than importing them from overseas. According to a Reuters report, Mexico’s deputy economy minister Vidal Llerenas said production for such components could begin as soon as this month.

Foxconn imports various components to Mexico for use in the manufacturing of GM vehicles. The Asian tech company specializes in electronic components, critical parts for infotainment systems, including displays, and components related to electric motors and batteries for EVs.

However, while GM said that it fully supported Mexico’s push to strengthen supply chains in the country, it has yet to announce any plans or a timeline, or even acknowledge what it considers as speculation at this point.

Although GM manufactures a significant volume of vehicles in Mexico, many of which are sold throughout North America, a large majority of General Motors products sold to the Mexican domestic market are built in China. Of all the General Motors vehicles sold in Mexico, six of the top seven most popular models are all made in China.

If the talks between General Motors, Foxconn, and the Mexican government are successful, it could result in more GM vehicles sold in Mexico being built in Mexico. Right now, the only domestically-built General Motors vehicles for the Mexican market are the highly profitable Chevy Silverado, Chevy Cheyenne, and GMC Sierra full-size pickup trucks.

This collaboration between businesses and governments is part of an ongoing global effort to bolster domestic manufacturing and reduce dependence on overseas imports. Reshoring or “nearshoring” such manufacturing has benefits, such as mitigating supply chain disruptions while reducing shipping times and costs. In this case, it would also bolster the Mexican economy by bringing more jobs and commerce to the country.

The Mexican government is also engaging with delivery company DHL and General Motors rival Stellantis to gauge whether those companies can do more manufacturing in Mexico in a mutually beneficial way. Llerenas said tech giant Intel and appliance maker MABE have already committed to replacing a portion of their imports with components produced domestically in Mexico.