Following the decision of the Argentinian government to suspend for three years the Bilateral Economic Agreement 55, which covers the automotive sector, Mexican produced vehicles will have to pay a 35% import tariff, while taxes on parts and components will increase between 16% and 18%.

Models that will be particularly impacted by this decision will be the Chevrolet Aveo, Dodge Journey, Fiat 500, Ford Fiesta, Honda CRV, Nissan’s March, Sentra and Tilda, as well as the VW Bora and Jetta.

According to Guillermo Rosales, Executive Director for institutional relations of the Mexican Automotive Distributors Association (AMDA), “This protectionist measure is contrary to the best practices of free commerce."

Mexican automotive exports have risen by around 13.7% this year, according to figures released by the Mexican Automotive Association. Argentina has traditionally been Mexico's second best Latin American export market, accounting for 20% of all vehicles sold abroad, although exports this year have fallen by 25%.

Significantly, figures released by the Automotive Manufacturers Association indicate that its members have also seen a decline in the Argentinian market, where local sales fell 1.9% in the first five months of the year, with production falling by 10.5% and overall exports by 26.5%.

Within Mexico, the first five months of this year saw vehicles imported and exported through the country’s ports increase by 29.5% to 500,963 units.

Exports increased to 372,382 units, while imports rose to 228,591 units, compared to 270,568 units and 116,402 units respectively in 2011.

Total exports for the first five months rose 13.7% to 945,530 units, while production for the domestic market went up by 2.4% 207 7846 units.

At the port of Lázaro Cárdenas imports rose almost 100% to 67,523 units, while finished vehicles in total increased by 61.4% to 81,744 units. This was in contrast to Manzanillo where traffic fell by 46.7% from 17,256 units to just 9,196. Vera Cruz remains Mexico's most important port for automotive traffic in the Mexican Gulf, with exports in the first five months increasing by more than 100,000 units to 300,192.

Significantly, exports of finished vehicles do appear to be declining. For example, in May alone, they were down by 5.7%, which is due to a 0.5% decrease in Mexico's biggest export market: the US, which accounts for 60.9% of the total. In contrast, Latin American exports have gone up by 31.6%, a figure somewhat offset by the 41.4% decline in European traffic.

Overall production of finished vehicles in Mexico in May rose by 2.8%, which is the lowest increase since January 2012. Domestic consumption however rose by 18.7% in that month.

Port and import issues will be among the topics discussed at the forthcoming Automotive Logistics South America conference in Sao Paulo this September. Read more about it here