As the incoming Trump Administration remains committed to imposing tough tariffs on Mexican imports, the Mexican government is moving forward with its low-cost electric vehicle project.
The project,—called “Olinia,” which means “movement” in the native Nahuatl language—was announced last October, but President Claudia Sheinbaum provided the first details earlier this month.
As reported by the Financial Times, the goal is an “ultra-compact” electric vehicle—designed and built in Mexico—with a base price between 90,000-150,000 pesos, or about $4,400 and $7,300 at current exchange rates.
Ford Mustang Mach-E meeting – Mexico
This will be achieved through simplicity and simplicity. According to the Financial Times, officials want the Olinia EV to be recharged using a standard household socket instead of a dedicated charging station—like an electric machine rather than a car. That approach leaves aside the question of public charging infrastructure, which has become an issue for Mexico's EV adoption as it has in the US.
But instead of conventional EVs, their competition may be small motorcycles that are often used for short trips or as taxis in working areas. In that sense, it's like an electric refresh of the Tata Nano, a super-cheap petrol car designed for the Indian market as a safer, more comfortable two-wheeler.
The Olinia will likely compete with entry-level EVs from India and China. One in five cars sold in Mexico by 2023 was made in China, according to the Financial Times, indicating that, while Mexico produces a large number of cars, most are exported. The project could produce a made-in-Mexico EV that most of the country's citizens can afford, although given the small budget of 25 million pesos (about $1.2 million), the chances of it being produced in significant volumes remain doubtful.
BMW Group Plant San Luis Potosí in Mexico
Meanwhile, President Trump is expected to implement the aggressive tax plan discussed during the 2024 presidential campaign. That included a promise of a 100% tariff on Mexican-made vehicles from Chinese manufacturers—EV or not. He also promised to “punish” companies that export jobs to Mexico or rely heavily on Mexican-based manufacturing industries. Many analysts and industry experts have pointed out that such policies would increase the prices of new cars for American consumers, but without an actual policy here it is just speculation.
In November, Ward's Intelligence predicted that the tariff changes with Mexico would affect nearly 3 million vehicles a year, including some of the more affordable models coming to the U.S. market. With news reports suggesting a 25% tariff is what the administration may impose, Mexico may lose some economic power—and it needs to come up with more of its own programs to support manufacturing.