How to Buy a New Car in Mexico

How to Buy a New Car in Mexico – 5 Important Steps

Buying a car –or anything of value for that matter- in a foreign country can be an intimidating task at first – when it really shouldn’t be.

In this article, we are going to cover everything that you need to know about how to buy a new car in Mexico, from the mind of an industry expert.

If you would like to learn a bit more about me and my credentials, I invite you to take a lot at our about us page, where I detail my journey and experience within the car business.

Enough of me though – you’re here to learn about the ins and outs of purchasing a new car in Mexico, so let’s get started.

1.-Do your Homework

The first step in buying a new car in Mexico is figuring out which car you want to purchase. Easy enough, right? Not quite.

I will say that this is probably the most difficult step in the entire buying process; as a lot of thinking and effort have to go into deciding which vehicle is actually the right one, in a sea of infinite options.

Getting it wrong from the beginning can be a costly mistake – and one that I try to avoid with all my clients.

This is why using the assistance of a company like ours can make a world of a difference in choosing the right vehicle, according to your wants and needs.

A few of the questions, crucial to the selection process, which I ask all my clients, are the following:

• Why and what do you need the vehicle for?
• Will you be driving the vehicle or be driven?
• How often will you be driving it?
• How many and how often will you have passengers in the car?
• How much space do you need?
• Do you have any hobbies that require additional room/space?
• Will you be using it for shorter or longer rides… or both?
• How long do you intend on keeping the vehicle?
• How well do you think your vehicle of interest will hold up on the Mexican roads?
• Does it have good visibility?
• Is it easy to park?
• Do you like the way the vehicle looks and drives?

The above are just a small handful of sample questions that should cross your mind when trying to make an informed decision.

Once we’ve narrowed down what type of vehicle they’re interested in, it is now time to move on to window shopping the different options, offered in the Mexican market.

It is crucial to know and consider that vehicles sold in the Mexican market, that are also available/sold in other countries, will often be different in specs and features – sometimes drastically so.

A Honda CR-V or Toyota Rav4 sold in Mexico will not be exactly the same as those sold in the United States or Canada.

This is why when looking at cars online, it’s essential to make sure that the website being viewed is the Mexican version. This can easily be determined by looking for the .mx at the end of the URL.

Finding/accessing these websites can be easily done by typing search terms like “Mazda Mexico” or “Ford Mexico” into a search engine of choice, like Google. Once the website is accessed, some web browsers, such as Google Chrome, will allow the user to translate the entire page.

2.- Find a Reputable Dealership

Once we’ve determined which car(s) is/are worth looking at, the next step is planning a trip to a dealer(s).

A big thing to consider is that pricing for new cars is fixed in Mexico and will be the same for all dealerships across the country. Prices are subject to change and already include sales tax (IVA).

While new car buyers can sometimes get away with getting free, small accessories like tinting or rubber mats, the final price is non-negotiable and will always be determined by the manufacturer. The prices will be listed on the official manufacturer websites.

The above fact might sound like bad news for those that enjoy negotiating, but I can honestly say that the fixed-pricing rule makes the buying process a lot easier and less stressful.

Of course, there are some exceptions to the rule when it comes to negotiation, but these generally apply to luxury vehicles that have fatter profit margins and are subject to high depreciation.

Another thing to consider is that new car prices in Mexico aren’t astronomically different that the United States and Canada, but they are generally lower.

For those that are interested in seeing a price comparison between a vehicle sold in the United States and Mexico, you can read up on our dedicated article by clicking here.

It has happened on several occasions, people have boasted to their friends about being able to negotiate the price down on a new vehicle, getting the equivalent of a few hundred dollars off.

The reality is that, depending on sales numbers, some manufacturers will offer nationwide discounts or rebates on select models and trims that they’re having trouble selling.

This can also happen when a new model year is close to being released and they want the previous model to sell out.

Here’s what those people didn’t know.

Some salespeople will sometimes “forget” to mention that there’s a discount on the vehicle and use the rebate to their advantage in an effort to close the deal. At the end of the day though, the client will get the discount/rebate, regardless.

These points all lead us to the following question… If the pricing on new cars is the same across all dealers in Mexico, where should one buy the car?

Well, simply put, this is where choosing a reputable dealer comes into play. Or better yet, you can save time and energy by using a broker like us.

For those that live in Lake Chapala, the closest dealers will be located in the Guadalajara Metropolitan Area and its surroundings.

3.- Test Driving the Car

Once the research has been done, the potential candidates have been narrowed down and the dealers have been set as destinations on the GPS, the next step is physically going in and looking at the cars in person.

At the time of writing this article, not all brands and dealers have a ton of inventory for test driving or even looking at.

This is all due to the -still- ongoing shortages that started a few years back. However, if at all possible, I think it’s crucial for the client to sit in and test drive the vehicle(s) that they’re interested in.

As far as the test drive is concerned, the dealership will have a predetermined route to take you, as a client, on. In some instances, although not as frequent now thanks to the shortages, I was able to get a vehicle down to Lake Chapala for the client to drive, rather than taking them to Guadalajara.

To say that I’m not a fan of the way car dealers do test drives is an understatement. The way it works with them is that they generally like to take the client on the predetermined route, with the salesperson driving, so they can showcase the vehicle’s abilities.

What does this generally mean? Simply put, they do a series of tests to showcase the acceleration, braking, and stability of the car. I’ve never seen a client enjoy these displays and find them a bit over the top.

Let’s face it… most modern cars have ABS and good brakes, can get up to speed just fine, and are equipped with traction and stability controls.

I can absolutely guarantee that the average person won’t be able to tell the difference in the above tests between two small Asian hatchbacks that cost the same… because there won’t be much, if any difference at all.

My advice when going on a test drive is to skip the entertainment act and just test drive the vehicle like you normally would.

During the test drive, focus on how the car feels and behaves. If at all possible, take notes and try to figure out the following:

• Do you have good visibility out of the windows?
• Does the seat feel comfortable?
• How is the ride quality?
• How are the driving dynamics? i.e. suspension feel, acceleration, etc.
• Do you like the way the controls (AC, infotainment screen, odometer, shifter) are laid out?
• Is it easy to park?
• Does it go over bumps well?

I recommend to all of my clients to drive the vehicle like they normally would so they can get an understanding of how the vehicle behaves under normal, everyday circumstances

4.- Choosing a trim and package

A big thing to consider with car buying in Mexico is that vehicles are not sold in the same manner as in other countries. Whereas you might be able to “build or spec a vehicle out” north of the border; no such thing exists down here.

Cars and trucks in Mexico are sold in different packages. Each package offers standard features and equipment that can’t be switched out or removed.

For example, sunroofs generally –although not always- come equipped in the most expensive trims; if you were to want a sunroof in a base model, it would be almost impossible to do.

This is why it’s extremely important to pay close attention to what features you desire in a car and which package comes closest to having what you want/need.

There are, like always, exceptions to the rule with premium brands like Porsche, Mercedes Benz, BMW, Audi, etc.

In some cases, dealers will offer aftermarket accessories that can be equipped on the vehicle.

For example, if the vehicle comes standard with cloth, they can do leather upholstery at an additional cost. The same goes for backup cameras, parking sensors, roof racks, etc.

5.- Paying for the Car

Once you have determined which car you want to purchase, the next step will be leaving a deposit to either hold the car, if they have it in stock, or place an order – should the vehicle not be in stock.

Each dealer will work differently than the rest, as they will have their own internal rules and policies. Minimum deposits for holding a car can often be as little as $5,000 – $10,000 pesos.

How long will they hold a car with a deposit? This will be highly dependent on the dealer’s terms and conditions. Nonetheless, don’t expect a dealer to hold a vehicle and wait on payment for more than a week or two – while some may do so, most won’t wait that long and will sell to a different client that already has the money in hand.

One thing that is crucial to consider is that if the car isn’t in stock, the deposit will only guarantee you a spot on the dealer’s waiting list. It will not guarantee an arrival time for the vehicle, price, or even that they’ll be able to get the desired trim and color.

I mention this because we’re currently going through a rough time within the automotive industry in which there are a lot of shortages across all manufacturers.

If a dealer can currently guarantee to get a client a specific model car in their desired trim and color, they either already have it in their inventory or can read the future. I wouldn’t put any money on the latter.

Deposits are generally refundable should the client decide to cancel the order/purchase, unless otherwise stated by the dealer.

Although, there are other a couple of factors that can contribute to the client losing their deposit; like canceling the purchase once the car has been already titled.

Moving on… let’s say that the dealer has the vehicle you want in stock and you’re ready to buy. You’re probably wondering how to actually pay for the vehicle. There are three possible options.

SPEI Transfer (Transfer In pesos from Mexican bank to another)

This is, by far, the best and easiest way for the dealer to receive their money, since it’s almost instant. For this method, the client must have a Mexican account set up with pesos, which will then be transferred to the dealer’s bank.

The hardest part about this payment method is moving money down to Mexico. Once done, however, the dealer has their money in less than an hour.

A SPEI transfer can generally be done by either physically going to the bank or through the bank’s online app; should the bank have one and the client be registered with it.

Credit or Debit Card

This is, in theory, the easiest and quickest way of paying for a vehicle. Not all dealers accept full payment on a card, but if they do, all it takes is a quick swipe. Payment can also be split and done so on multiple cards.

The main downside to this payment method is that you must first call your bank to notify them of the transaction so that it is not flagged as a scam and rejected.

Following this, the dealer’s bank will charge a commission fee for use of the card which can be 3%- 3.5% plus IVA, with Visa and Mastercard. This applies for both credit and debit cards and the commission can double when using AMEX.

Even though the amount will leave the client’s account instantly, it can take several days for the money to reflect on the dealer’s end.

A few positives to using this payment method are getting air miles –if offered by your bank- as well as getting a superior rate of exchange than that of moving money to Mexico through wires.

International Wire Transfer

By far the least recommended payment method is an international wire transfer. Dealers are simply not accustomed to receiving them and I’ve seen nothing but chaos when clients decide to use this method.

You will almost always get a terrible rate of exchange and the money can take days and days to clear. There’s truly nothing worse than not knowing when or if the money will show on their account and the dealer pressuring the client because it’s not in their account yet.

To do an international transfer, the dealer must provide their banking information alongside a SWIFT code. Most dealers –not all though- will get confused when the latter is requested.

This is not to say that you shouldn’t consider this method when buying a new car, you should just know the potential risks.

Insurance, Registration, and Taking Delivery

Once the vehicle is paid for, the dealer will prepare the car for a pre-delivery inspection, as well as have it fully detailed. This can take several days to finalize, depending on the dealer’s workload.

The car will then have to be licensed, registered, and insured for it to be either picked up at the dealership or delivered to the client’s address – it will all depend on the dealer’s delivery policies and the client’s preference.

Licensing and registration can add a day or two to the entire process as it’s all done by appointment only with the state DMV.

Lastly, upon delivery, a series of paperwork will have to be signed by the buyer. The delivery process can take a total of 1-2 hours. During the delivery, the client will receive an introduction to the car as well as its functions and features.

To learn what’s involved with registering and licensing a vehicle in the State of Jalisco, please visit our full write-up here.

All in all, from the time a deposit is given till the time the client takes possession of the vehicle, the entire process can take a week to a week and a half on average.

This is factoring that the vehicle is already in stock. Timeframes can vary and can be shorter or longer, depending on a series of factors.

Warranty and Servicing

With a new car, all mechanical and electrical warranty work and/or servicing must be, without exception, performed at a licensed dealership, as per the manufacturer’s terms and conditions.

Tires, bodywork, windshield replacement, etc. don’t have to necessarily be done at an authorized dealership.

Let’s take a new Kia for example.

All Kia cars come with a 7-year (or 150,000 kms) warranty. To maintain it, the car has to be serviced every 6 months or 10,000 kms – whichever happens first. Only certified Kia dealers can work or mechanically touch the vehicle.

Each manufacturer will have different rules, which is why it’s important to be completely informed of their servicing and warranty terms and conditions.

Failure to follow the manufacturer’s rules will result in the automatic cancellation of the vehicle’s warranty.

Lastly, for the duration of the warranty, the client has free access to roadside assistance through the manufacturer.

Roadside assistance covers general towing, flat tires, dead batteries, lack of fuel, or mechanical failure.

As you can see, buying a new car in Mexico is quite the experience.

Nevertheless, it doesn’t have to be a negative or complicated one; if you have all the right tools, information, and assistance.

If you have any questions or concerns that you think we missed in this article or on our related articles, please don’t hesitate to reach out to contact us by using our contact form.

I guarantee that we will get back to you as soon as we can.