Mexican President Claudia Sheinbaum and Economy Minister Marcelo Ebrard held high-level meetings with Japanese corporate leaders and diplomats at the National Palace to strengthen economic cooperation, safeguard regional supply chains, and address regulatory challenges under the USMCA. The bilateral discussions coincide with contrasting shifts in Mexico’s automotive sector during the first half of 2026, where a 44% surge in domestic electric and hybrid vehicle sales, driven heavily by Asian brands, clashes with a 57% drop in domestic electric vehicle (EV) manufacturing destined for the slowing US export market.
Bilateral Investment and Trade Facilitation
The executive meetings focused on securing foreign direct investment and resolving operational friction for Japanese corporations operating within Mexico. The foreign delegation was led by Seiji Kuraishi, president of the Japan-Mexico Economic Committee and advisor to Honda Motor, alongside members of the Japan Business Federation (Keidanren) and the Japanese Ambassador to Mexico, Kozo Honsei.
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According to official figures released by the administration, Japan maintains a significant industrial footprint in the country.
“In our country, there are 1,600 Japanese companies that generate 350,000 direct jobs,” President Sheinbaum stated following the talks.
Parallel discussions led by Economy Minister Ebrard, alongside Undersecretary of Industry and Commerce Ximena Escobedo and Undersecretary of Foreign Trade Luis Rosendo Gutiérrez, focused heavily on the North American trade landscape. The Ministry of Economy (SE) confirmed it is actively tracking 39 prospective Japanese investment projects. Over the past five months, the ministry resolved 90% of identified business environment friction points, with both nations agreeing to maintain continuous coordination regarding energy policies, customs operations, and trade facilitation.
Corporate participants representing the Japanese private sector included executives from Honda, Toyota, Nissan, Mazda, Panasonic Holdings, NSK, Mitsubishi Electric Automotive, Mitsubishi, All Nippon Airways, and ANA Holdings. The Ministry of Economy reported that the delegation “highlighted the importance of working together to strengthen the presence of Japanese companies in Mexico,” while Ebrard reiterated Mexico’s commitment to “facilitate investments and strengthen competitiveness and value chains.”
Domestic Electrification Surge vs. Export Production Slump
The diplomatic push to anchor Asian industrial supply chains comes amid major structural shifts in the Mexican automotive market. Data from the AMIA and the INEGI reveal that domestic sales of hybrid, plug-in hybrid, and electric vehicles reached 95,037 units during the first half of 2026, up 44% from the 65,991 units sold in the same period of 2025. Electrified models now account for 12.6% of all vehicle sales in Mexico, compared to 9.2% last year.
Chinese automaker BYD has established clear dominance in this expanding sector. Between January and June of 2026, BYD sold 33,969 units, capturing 35.7%, nearly four out of every ten, of the country’s total electrified vehicle market. The company currently markets four fully electric models and seven plug-in hybrids, including the entry-level BYD Dolphin Mini.
According to Eric Ramírez, regional director for Urban Science, BYD aims to reach 80,000 annual units sold in Mexico, though he noted that “more than 50 brands in the country compete vigorously with each other, causing a dynamic that complicates the fulfillment of the metric.”
Other international brands are also expanding their market shares:
MG Motors: Registered 2,499 electrified units across five models, led by the ZS Hybrid+ with 1,080 units.KIA: Sold 2,212 units, with the Sportage Hybrid accounting for 99% of its electrified sales.Changan: Logged 475 units, including 351 units of its Deepal S07 extended-range crossover.General Motors: Reported 235 electrified units sold, including 157 units of the Chevrolet Equinox EV.
Geographically, the commercialization of these vehicles remains highly centralized. The Electro Movilidad Asociación (EMA) reported that four federal entities, Mexico City (21,766 units), the State of Mexico (12,736 units), Nuevo León (9,947 units), and Jalisco (8,513 units), combined to represent 55.7% of all domestic electrified vehicle sales. Eugenio Grandio, president, EMA, attributed the expansion to “the development of charging infrastructure, greater consumer awareness, and increased financing options.”
However, this domestic demand contrasts sharply with Mexico’s export-oriented manufacturing sector. While Asian imports fuel local consumption, domestic production of electrified vehicles built strictly for export fell 57% in the first half of 2026, dropping to 47,411 units from the 110,002 units assembled during the first half of 2025.
Industry analysts point to a cooling US consumer market and changing federal purchase incentives as the primary drivers behind the production slowdown. The contraction heavily affected major American manufacturing footprints in Mexico; Inegi data shows that General Motors’ assembly of the Equinox EV plummeted 81.6% (from 38,995 units in 2025 down to 7,185 units in 2026), while production of the Blazer EV fell 80% (from 10,469 units down to 2,099 units).