The Mexican Treasury Department published a new extension on Thursday afternoon of the deadline for regularizing used vehicles of foreign origin. Under this decree, 2.5 million cars have entered the country.
Less than a week before the end of his six-year term, Mexican President Andrés Manuel López Obrador has decided to extend for two more years the validity of the automotive decree that allows the regularization of imported used vehicles, a government policy that the automotive industry considers “harmful.”
"It is regrettable that López Obrador is invading the mandate of (President-elect) Claudia Sheinbaum with his decision, by extending the decree for two more years, just four days before the end of her presidency," said Guillermo Rosales, president of the Mexican Association of Automobile Distributors (AMDA).
During an evening publication, the still Chief Executive published in the Official Gazette of the Federation the extension of the decree until September 30, 2026, with the argument that: "The government of Mexico is obliged to implement and continue with strategies that improve the well-being of the population, provide legal certainty, protect family assets and guarantee public safety, such as the regularization of used vehicles of foreign origin that have not processed their definitive importation, that is, have not accredited their legal stay in the country."
The decree allows the regularization of used vehicles of foreign origin that are located in the states of Baja California, Baja California Sur, Chihuahua, Coahuila de Zaragoza, Durango, Hidalgo, Jalisco, Michoacán de Ocampo, Nayarit, Nuevo León, San Luis Potosí, Sinaloa, Sonora, Tamaulipas, Tlaxcala and Zacatecas, federal entities that have a high rate of migrant population in the United States and Canada.
AMDA reported that the decree on foreign used vehicles was published on January 19, 2022 and has regularized 2,559,256 vehicles, affecting the industry.
The revenue from used cars has increased by 52.7% since Andrés Manuel López Obrador's six-year term, compared to the previous administration.
IT IS AN ADVANCE DECISION BY AMLO: DISTRIBUTORS
New and used vehicle dealers operating in Mexico regretted López Obrador's "hasty" decision, since "President Sheinbaum's technical knowledge, professional career and commitment to the environment led us to believe that a government policy harmful to Mexico should be reversed."
In the Transitional section, first, the Executive states that the decree will come into force from January 1, 2023, until September 30, 2026, so it will remain in force.
AMDA warned that, “far from helping to prevent smuggling, illegality and the circulation of unidentified vehicles, the authorized regularization without major control mechanisms would become an incentive to smuggling.”
He said that the participation of organized crime gangs in the entire process of smuggling and illegal sale of vehicles has been confirmed. “These groups have been the main beneficiaries of President López Obrador's Decree,” he accused.
On Thursday afternoon, the president of Concanaco Servytur, Octavio de la Torre, asked the government in power to maintain the validity of this decree that has been vital for the development of the border regions.
“Concanaco has formally submitted requests for the extension of the validity of the tax and tariff decrees,” he stressed.
