Mexico Auto Production, Exports Climb In July

But domestic sales fall, possibly as a result of political uncertainty

MEXICO CITY (AP) – Mexico's auto production and exports rose sharply in July, and industry leaders said Tuesday they expect to have a record year.

The Mexican Auto Industry Association (AMIA) said Tuesday that production last month was up 21 percent from July 2005, while exports grew 32 percent over the same period.

Cesar Flores, the association's president, told a press conference that he expects a record year in production and exports.

So far this year, production has been up 37 percent compared to the same period in 2005, while exports have gained 48 percent.

Mexico's automotive industry, the country's largest single manufacturing sector, has been undergoing a sharp recovery since the second half of last year. Meanwhile, auto manufacturers in the U.S. have been struggling in the face of foreign competition and some have announced plans to beef up their plants south of the border.

Ford Motor Co. unveiled a turnaround plan in January called ''The Way Forward,'' which includes closure of 14 U.S. plants by 2012 and cutting up to 30,000 hourly workers in North America. The company, however, plans to expand operations at its three Mexican plants.

Mexico's auto industry said its domestic sales fell 2.3 percent compared to July 2005, but Flores dismissed the drop as seasonal and said it was not a result of the contested presidential election, which has seen the leftist candidate allege vote fraud and call for massive protests.

''We don't believe that political events have been a big factor in reducing sales in July,'' Flores said, though he noted that consumers are likely postponing purchases in such a period of political uncertainty.

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