Used Vehicle Imports Impact on New Vehicle Sales: The Mexican Case

This paper analyzes the potential impact of used vehicle trade liberalization on Mexico's new vehicle market with the full implementation of the NAFTA agreement. Although the legal environment has been unfavorable toward the importation of used vehicles into Mexico, used vehicles primarily from...

Descripción completa

Guardado en:
Detalles Bibliográficos
Autores principales: Ted Chu, Alejandro Delgado
Formato: Artículo científico
Publicado: Universidad Autónoma Metropolitana Unidad Azcapotzalco 2009
Materias:
Economía y Finanzas
Trade
used vehicle imports
Mexico
Acceso en línea:http://www.redalyc.org/articulo.oa?id=41311453016
http://biblioteca.clacso.edu.ar/gsdl/cgi-bin/library.cgi?a=d&c=mx/mx-022&d=41311453016oai
Aporte de:
Red de Bibliotecas Virtuales de Ciencias Sociales (CLACSO) de Consejo Latinoamericano de Ciencias Sociales
id I16-R122-41311453016oai
record_format dspace
institution Consejo Latinoamericano de Ciencias Sociales
institution_str I-16
repository_str R-122
collection Red de Bibliotecas Virtuales de Ciencias Sociales (CLACSO)
topic Economía y Finanzas
Trade
used vehicle imports
Mexico
spellingShingle Economía y Finanzas
Trade
used vehicle imports
Mexico
Ted Chu
Alejandro Delgado
Used Vehicle Imports Impact on New Vehicle Sales: The Mexican Case
topic_facet Economía y Finanzas
Trade
used vehicle imports
Mexico
description This paper analyzes the potential impact of used vehicle trade liberalization on Mexico's new vehicle market with the full implementation of the NAFTA agreement. Although the legal environment has been unfavorable toward the importation of used vehicles into Mexico, used vehicles primarily from the U.S. have entered the market as gray or illegal goods. In recent years Mexico may have already become a dumping ground for U.S. used vehicles. Beginning in 2009, Mexico is set to progressively open the market for used vehicle imports according to NAFTA regulations, fully liberalizing it by 2019. To quantify the potential impact of legal used vehicle imports, this paper develops a new analytical model. Given the lack of historical data, the methodology combines econometric estimation with a comparative analysis using the Polish used vehicle case as foundation. Through various scenarios, our research suggests that the medium-to-long term impact on new vehicle sales could be severe. The auto industry could reach a low 0.6 million units by the time the market is fully liberalized. And even under the most optimistic scenario, the industry only reaches 1.3 million units by 2019, not much higher than the 1.15 million units in 2007. While some academic literature indicates that there are social and economic benefits of free trade in used vehicles, at least in the case of a lower income market opening itself up to a much larger and higher income mature market, the net impact seems to be negative. Industry generated revenue losses for both automakers and the Mexican government could reach as high as $100 billion in the 2009-2019 period.
format Artículo científico
Artículo científico
author Ted Chu
Alejandro Delgado
author_facet Ted Chu
Alejandro Delgado
author_sort Ted Chu
title Used Vehicle Imports Impact on New Vehicle Sales: The Mexican Case
title_short Used Vehicle Imports Impact on New Vehicle Sales: The Mexican Case
title_full Used Vehicle Imports Impact on New Vehicle Sales: The Mexican Case
title_fullStr Used Vehicle Imports Impact on New Vehicle Sales: The Mexican Case
title_full_unstemmed Used Vehicle Imports Impact on New Vehicle Sales: The Mexican Case
title_sort used vehicle imports impact on new vehicle sales: the mexican case
publisher Universidad Autónoma Metropolitana Unidad Azcapotzalco
publishDate 2009
url http://www.redalyc.org/articulo.oa?id=41311453016
http://biblioteca.clacso.edu.ar/gsdl/cgi-bin/library.cgi?a=d&c=mx/mx-022&d=41311453016oai
work_keys_str_mv AT tedchu usedvehicleimportsimpactonnewvehiclesalesthemexicancase
AT alejandrodelgado usedvehicleimportsimpactonnewvehiclesalesthemexicancase
bdutipo_str Repositorios
_version_ 1764820423539687424

Ejemplares similares