According to Interact Analysis’s newly released 2024 Global Collaborative Robots research report:

The global collaborative robot market will grow by 11.9% in 2023, hitting a new low after 2020. It is worth noting that Mexico, once considered a “dark horse for growth,” became the only region in the global collaborative robot market to experience negative growth (-0.2%). However, according to our latest forecast, the Mexican market will still show strong growth potential over the next five years, and its share of the global market is expected to rise to 3.6% by 2028.

IS200TSVCH1AJE With negative growth and hope on the one hand, the “contrast” presented by the Mexican collaborative robot market has attracted our great attention. This article will analyze the factors behind this “negative growth” and explore the development potential of the Mexican cobot market.

Mexican manufacturing at the right time

According to Interact Analysis’s latest global manufacturing output tracker, Mexico’s manufacturing output will grow at an average annual rate of 4.6% over the next five years, faster than any other major economy in the world. This is due to the trend of “nearshore outsourcing” – with its location, cost-effectiveness, well-established manufacturing base and close links to the North American market, Mexico has become the preferred location for many companies to outsource nearshore. With the continuous growth of the Mexican economy and the continuous release of the potential of the local market, enterprises investing in Mexico to build factories can not only serve the US market, but also explore the local Mexican market.

Mexico’s commitment to trade liberalization has made it one of the most open and competitive markets in the world. This can be seen in Mexico’s 13 free trade Agreements (FTAs) with 50 countries. Among them, the signing of the United States-Mexico-Canada Agreement (USMCA) was particularly key, which virtually eliminated tariff barriers on U.S. exports to Mexico, thus attracting well-known automakers such as Tesla, BMW, Nissan, Honda, Ford, Audi, Daimler, Mazda, and Toyota to set up or expand assembly plants in Mexico.

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In the past five years, this growth has also attracted more than 500 new automotive suppliers from the United States and other countries to enter the Mexican market. Today, Mexico is the world’s seventh largest manufacturer of passenger cars and sixth largest manufacturer of heavy cargo vehicles. Over the past decade, the Mexican government has been doing everything it can to promote foreign investment in order to attract more manufacturing companies to the domestic market. These strategic initiatives have had some success, for example, the growth of Mexico’s automotive industry has not only created jobs and boosted the national economy, but also led to investment in other industries, such as auto parts manufacturing and related industries such as logistics.

IS200TSVCH1AJE Benefiting from this, the penetration rate of robotics technology in Mexico has also increased rapidly, especially the contribution of the automotive industry.

Why “negative growth”?

Mexico, once one of the fastest growing regional markets for cobots, saw an unusually negative growth in 2023 for several reasons:

Auto industry recession

From the industry point of view, the automotive industry is an important application field of collaborative robots. According to Interact Analysis’s Collaborative Robots research report, more than 50% of collaborative robots are sold to companies related to the automotive industry. Similarly, the automotive industry is the largest destination for collaborative robot sales in North America. In 2023, the North American automotive industry is facing significant pressure, which has resulted in a fairly slow growth in robot sales, both for original equipment manufacturers and component suppliers.

Mexico is more dependent on the auto industry than the United States and Canada. The automotive industry has become the largest manufacturing sector in Mexico, accounting for 34% of the country’s total manufacturing output. As a result, the overall downturn in the North American automotive industry is more significantly dragging down the market performance of Mexican cobots.

This phenomenon demonstrates both the important role of the automotive industry in driving the collaborative robot market and the depth of the Mexican economy’s binding to specific industries. However, as the automotive industry actively ADAPTS to market changes and seeks technological innovation, it is expected that the use of cobots in this field will regain momentum in the next few years.