Mexico’s New President Has A Plan: A Cheap Mexican EV For The Masses Called “Olinia”
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Claudia Sheinbaum, Mexico’s new president (inaugurated in October 1st), has a plan. She wants to bring Mexico’s industry into the 21st century, pivoting to tech, drones, semi-conductors, … and EVs. She has announced she’ll make sure that, by the end of her term, Mexico owns a locally designed, locally built, affordable EV that will be named “Olinia” — Olini is Náhuatl for “movement.” As such, it’s only natural that the most Mexican car ever should be named after this word.
Mexico has been an automotive producer for decades, but, numbers-wise, it only became a powerhouse in the last decade or so: in such short time it has never produced a proprietary Mexican brand. Sheinbaum’s plan is to make sure it gets one, and by making it electric she will assure it belongs to the future instead of the past.
Olinia
To be fair, such plans of greatness are common in Latin America, and they rarely end up well. Bolivia’s state-promoted “Quantum” quadrycicle, for example, has only sold token amounts despite its expansion in the region.
But if there’s one country in the region that can pull this off, it’s Mexico. The country has a developed automotive industry with nascent EV production (as we talked about in our LatAm EV Manufacturing Report), strong supply chains, affordable energy, and an educated population.
The proposed name for the car (and an eventual Mexican brand) comes from the Náhuatl language: the original tongue of the Mexicas (also known as Aztecs) that inhabited the Central Mexican Plateau at the time of Cortés’s arrival. As such, it’s supposed to be a symbol of Mexico’s resurgence as a regional power and a cornerstone for the independence and sovereignty of its nation.
Olinia is just a concept for now, but it speaks volumes to the focus the new Mexican government will have. Mexico’s prior president — Andrés Manuel López Obrador “AMLO” — was not too invested in EVs, but Sheinbaum clearly has her priorities clear, and it’s set on making Mexico a big player in the mobility of the future.
Mexico’s upcoming policy changes
Olinia is not coming alone. Sheinbaum is also proposing an overarching policy aimed for the industries of the future, including semiconductors and lithium extraction and refinement.
More important, however, are trade policies. Since 2020, Mexico had exempted EVs from any tariffs and import taxes, but this is ending this month. Now, only countries which have signed FTA with Mexico will be allowed to import EVs without tariffs … and this does not include China.
My take on this is that Sheinbaum is serious. Mexico is not the US, and it has been more than clear than it will gladly approve and receive Chinese investment in the form of local factories. Sheinbaum now wants to speed up that process. It also seems to be working: BYD is now poised to announce its upcoming factory in Mexico before the end of 2024.
It may well be that Olinia — as currently proposed — never comes to life, but, in the meantime, Mexico is likely to become a big player in the EV landscape, and it may even build its first-ever local brand. After all, what’s Japan without Toyota? What’s Korea without Hyundai/Kia? Who knows, perhaps two decades from now Olinia (or its successor) will be a well-positioned name worldwide.
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