Gerardo Romero, vice president of operations at Toyota Motor Sales de México, points out that Chinese manufacturers are offering competitive prices, which has contributed to reducing the demand for used cars. “Chinese brands are helping in a way,” he said.
This situation, however, has led to a paradox, in which the prices of new cars can be even lower than used cars.
New or used car?
Jossimar Hernandez, MG Motor’s product director, points out that consumers are finding attractive options in the new car market, where they can purchase models at similar or even lower prices than second-hand ones. “Customers who would have bought a used car are now considering buying new or waiting for used prices to come down,” he said.
The most recent quote for a new sedan MG 5 is 298,000 pesos, while the cash price of a pre-owned Corolla, year 2020, is 332,999 pesos on the Kavak used car sales platform.
the SUV Chirey Tiggo 4 Pro It costs 399,900 pesos, while a pre-owned 2020 Volkswagen T-Cross model is at 406,999 pesos, on the same used car platform.
Data shows that more and more Mexican consumers are overcoming their reluctance to adopt Chinese brands, captivated by immediate availability and competitive prices. Chinese brands such as MG, Chirey, JAC, Baic, Changan and JMC represent almost 10% of new car sales in Mexico, according to Inegi data. In 2019, the two Chinese brands that were then in Mexico, BAIC and Jac, barely had 0.5% of the market.
Toyota Motor Sales President Guillermo Díaz said that although dealers still face waiting lists, however, he expects greater inventory availability for the second half of the year.
“It’s not that we don’t have units, it’s just that we have a demand that is higher than the supply that our plants can supply. But we are receiving vehicles and we plan to sell more this year than last and in 2024 more than this year,” Díaz said.
Hernández anticipates that as manufacturers recover their inventory levels and new Chinese brands hit the market, prices will stabilize. “One effect that is going to start to happen is a drop in the price of pre-owned,” he concluded.