Mexico Motorcycles Market is one of the fastest growing this year, after being resilient in the previous year crisis. Sales increased a huge +26.8% increase in the first quarter, the best ever, and are projecting a new all time record with a sharp increase. Italika is dominating.
Motorcycles Market Trend 2021
The Mexican motorcycles market keeps to fly ahead.
The market has been one of the best worldwide in the last decade and the covid19 just enhancing the demand for two wheelers, with sales boosted towards new records.
Mexico is among the world’s 15 largest economies and is the second largest economy in Latin America. The country is highly dependent on the United States, its largest trading partner and destination of nearly 80% of its exports.
According to the IMF, GDP contracted by an estimated -8.2% in 2020, due to the outbreak of COVID-19. However, the country is expected to recover in the coming years, as the IMF’s April 2021 forecast projects a growth of 5% for 2021 and 3% for 2022, subject to post-pandemic global economic recovery.
The motorcycles market, one of the few industrial sector reporting a 2020 growth, is now booming again with first quarter sales at 324.000, up 26.8% from the correspondent period last year and 23.7% from the Q1 2019.
At this level, the quarter was the highest ever and project the entire year at a new all-time record.
Reasons behind the boom are four:
- Demand for individual mobility
- High consumer spending due to low interest rate and high liquidity
- Demand for environmental respectful vehicles, as 2-wheeler are generally considered, and for electric scooters
- Strong growth for the market dominator, the domestic producers, Italika
The market leader was again Italika with over 70% of market share, followed by Honda, Vento and Carabela.
In 2020 Italika dominates a market again above the 1 million sales
In the last decade, the motorcycles industry pumped up in Mexico from very low level to become one of the largest in the World and one of the few over 1 million annual sales.
The market growth was correlated with the outstanding growth of the local manufacturers, led by Italika, a giant with over three quarter of million annual production, which dominate the market with over 70% market share.
The uniqueness of this market is represented by the current sales mix, in which the local brand represent over 85% of sales, with Japanese brands not dominating as in the rest of the World and with premium brands marginal with less than 2% of market share.
The 2020 was hard here as in almost all the Latin America, but after difficulties found in the second quarter, the sales recovered in the second half, with double-digit scores in the last months.
At the end the year was again positive with the third consecutive score above the 1 million, at 1.080.000 (+3%), mainly thanks to the great Italika performance.
However, Italika is not the only local producer, as other brands on top of the local competition are made in Mexico, like Caravela and the second best seller, Vento, which is a company based in US, but selling in Latin America.
Together with the market leader, even the Indian Bajaj Auto contributed to support the market, rapidly expanding the presence in the market, thanks to the new local plant.
The new factory in Lerma, State of Mexico have a capacity of 50,000 units a year which can be doubled in five years to supply Mexican and other Central American markets.
Bajaj will not be the first foreign manufacturer to produce in Mexico. Honda motor has a capacity of 100.000 units in the Guadalajara plant, opened in 1985, with main production focused on GL150, CGL125, XR150L, DIO, CB190R models.
Main 2020 fact was the introduction of Euro 4 emission level standard, which is reducing the technologic gap over the most advance countries (Europe is at euro 5 stage) creating opportunities for local manufacturers to improve their technology and export in the surrounding countries.