With sales absolutely booming this year, US auto imports have reached $171.5 billion through the first half of 2015, a new record amount and an increase of $10.8 billion over the same period in 2014. For June alone, the figure amounts to $29.8 billion, according to Census Bureau data. Rapidly growing production in Mexico and a strong dollar compared to foreign currencies are among the main factors holding back vehicle exports, The Detroit News reports.
The record value of imports isn’t necessarily good news for the US economy, though. For June, the auto industry alone was responsible for over a third of the country’s $43.8 billion total trade deficit for that month, according to The Detroit News. For all of last year, the vehicle deficit figure amounted to $169 billion.
“Going forward, for the next two years, we expect net exports to be a drag on growth as domestic growth and a strong dollar bring in more imports and the strong dollar discourages exports,” IHS economist Patrick Newport said to The Detroit News. The opposite issue is giving Japanese automakers a boost at the moment because the currently weak yen allows brands to make more on exported vehicles. For example, in its first fiscal quarter financial report, Toyota attributed some of the automaker’s record-setting performance on “favorable foreign exchange rates.”
With a $35 billion auto trade deficit in the first half of the year, Mexico is among the leaders in sending vehicles here. That trend doesn’t look to change either. Earlier this year, Ford announced a $2.5-billion investment to build two new factoriesthere, and Toyota laid out plans for a $1-billion plant. Over three million vehicles were built there in 2014.