December 28, 2017 / 7:13 PM / 6 months ago

Mexico extends used-car import rules to help domestic sales

MEXICO CITY, Dec 28 (Reuters) - The Mexican government on Thursday extended rules that impose restrictions on the importation of used autos, to bolster domestic sales amid uncertainty over trade ties with the United States, the country’s top export market.

The rules, which decree environmental and price requirements, were extended to March 2019, according to a notice published in the government’s official gazette.

The Mexican Association of Automobile Distributors (AMDA) said the extension would help to curb imports of lower quality used cars and provide support to domestic vendors.

Mexico’s auto industry has over the past decade become one of the world’s top producers, and most of its vehicles are sold for export to the United States.

However, that trading relationship with the United States has been cast into doubt because of U.S. President Donald Trump’s threats to dump the North American Free Trade Agreement (NAFTA) if he cannot rework it to favor U.S. interests.

Given the uncertainty over NAFTA as well as over the outcome of Mexico’s July 2018 presidential election, renewing the import rules would help to contain potentially “negative variables on the domestic auto market,” AMDA said in a statement.

Industry officials say tougher import rules have helped encourage auto sales in Mexico, which in 2016 sold 1.6 million vehicles domestically, placing it twelfth among the world’s biggest internal markets, according to the Paris-based International Organization of Motor Vehicle Manufacturers (OICA).

That year Mexico built almost 3.6 million vehicles, making it the world’s No. 7 auto producer, OICA data show.

Negotiators from the United States, Canada and Mexico are due to meet for the next round of NAFTA talks in Montreal in late January. The talks have progressed only haltingly so far. (Reporting by Stephanie Eschenbacher and David Alire Garcia; Editing by Dave Graham and Steve Orlofsky)

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