A decree published earlier this year in the Official Gazette of the Federation (DOF) has allowed regularize foreign cars used, which enter Mexico mainly through the northern border and are popularly known as ‘chocolate cars‘.
The opinion, which was issued on January 19 of this year, has been in the crosshairs of the Mexican Association of Automotive Distributors (AMDA). For the director of that organization, Guillermo Rosales Zárate, there is disagreement with this decree because, in his opinion, it validates “a crime.”
‘Autos chocolate’: vehicle smuggling
It is said that the expression ‘chocolate cars’ has its origins on the US border, where the inhabitants were playing with the pronunciation of the term ‘crooked‘ until it was transformed into ‘chocolate’ to identify this type of vehicle.
However, for the automotive industry, the phrase simply defines the vehicle smugglingbecause as Rosales Zárate explains, “used vehicles that are purchased in the US cross the border, are entered into Mexico, are marketed and subsequently circulate without having complied with the formality of the customs procedure, that is, they do not They can prove their legal stay in the country and in accordance with the Foreign Trade Law, the Customs Law and the Penal Code itself”.
And contrary to what happens with smuggling –which is carried out surreptitiously–, in the case of chocolate cars, this occurs in broad daylight, “during business hours, using the lanes of normal border crossings,” denounces the director of AMDA.
Once in Mexican territory, the ‘chocolate cars’ are sold freely in street markets, that is, in conditioned vacant lots or even in streets where there is no type of restriction. That is to say: they are perfectly known by everyone, both by the people who buy them and by the authorities.
Provenance is not accredited
The Mexican automotive industry opposes the regularization of used foreign cars because, as Rosales Zárate points out, “there is no accreditation proof that the vehicles that are going to be legalized in Mexico do not come from a crime in the US”.
Along the same lines, he adds that “it is not proven that the vehicles that are being legalized in Mexico meet the minimum safety standardsas well as with the environmental laws regarding pollutant emission standards”.
Myths of the ‘chocolate cars’
One of the myths around foreign cars is their price. There is a belief that vehicles purchased in the US are cheaper than in Mexico. However, the director of AMDA clarifies, “this has ceased to be true since the entry into force of the Free Trade Agreement.”
However, as Rosales Zárate suggests, many of the vehicles that enter Mexico with this contraband characteristic are those that They can no longer circulate in the US. The reasons for this prohibition can be several: that they come from auctions, that they are damaged cars, or that they were repaired after being declared a total loss by insurers.
“Auction companies have the mission of selling this type of vehicle to countries with ‘institutional weakness’, as defined by the UN,” he explains, after highlighting that with this policy, the “automotive garbage from the USA” it is exported to the rest of the world.
Affectations to the automotive industry
Regularizing used cars that enter the national market illegally represents a impact on the formal vehicle market used and new, therefore, the AMDA has made strong opposition to this measure. However, according to Rosales Zárate, their claims were not heard.
“We have filed amparo requests in 16 federal courts,” explained the spokesman for the automotive industry. The purpose of this measure is for the Federal Judiciary to study the merits of the regularization decision, he feels a precedent and prevent it from persisting.
On the other hand, the president of the Mexican Association of the Automotive Industry (AMIA), José Guillermo Zozaya Délano, assured that the regularization of this type of vehiclebreak the rule of law.
“I have said that calling them ‘chocolate cars’ is a very ‘light’ term: they are illegal cars and they should be called that, and making them legal is a breach of the rule of law,” he told RT.
On the other hand, the president of AMIA showed his willingness to work with the authorities to thoroughly deal with the consequences of the measure. “Unfortunately we were not included and the decisions that were made were made, but we do not consider it an adequate measure“, he reiterated.
The decree to regularize foreign vehicles
According to the decree published in the DOF On January 19, 2022 and its subsequent modifications, used vehicles of foreign origin that are in the states of Baja California, Baja California Sur, Chihuahua, Coahuila, Durango, Jalisco, Michoacán may be regularized until December 31 of this year. , Nayarit, Nuevo León, Puebla, Sinaloa, Sonora, Tamaulipas and Zacatecas.
This regularization can be obtained no certificate of origin requiredprior permission from the Ministry of Economy, intervention of a customs agent or any other intermediary, or registration in the Register of Importers.
Models must be from the year 2016 or earlier, and the regularization automobiles designed for the transport of people and goods, with the exception of luxury, sports or armored vehicles.
To complete the process, interested parties must carry out a single payment of 2,500 pesos (128 dollars) for the issuance of license plates and other local vehicle control duties and taxes. Said amount will be allocated by the Ministry of Finance and Public Credit to paving actions in municipalities of the entities where ‘chocolate cars’ are legalized.
flood of illegal vehicles
According to data from the AMDA Deputy Director General, the automotive industry sold more than 1.3 million units in 2019. “It fell to 950,000 due to the pandemic [de covid-19] in 2020, in 2021 we recovered a little and went up to 1,015,000 units, this year we expect to close with 1,070,000 units and for next year it could be 1,090,000,” Rosales Zárate pointed out.
On the other hand the Report on the Regularization Program for Vehicles of Foreign Origin shows that as of November 7, 2022, 747,133 cars have been regularized in 134 modules, installed in the 14 states where it applies.
The largest registration is concentrated in three entities, with 53.1% of the total: Baja California, with 171,923 regularized cars; Chihuahua with 129,964, and Sonora with 95,062.
However, for Rosales Zárate, the regularization of 700,000 vehicles has not prevented the sale of cars without identification from continuing. “Today there are more vehicles circulating illegallythe markets where these vehicles are sold are more assorted, there is more inventory than there was in January, before the decree came into force.”
“It is truly a disorder, an avalanche of these vehicles,” concludes the manager.
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