Mexico’s federal government has officially terminated the regularization program for “chocolate cars,” ending a years-long policy that allowed the legal registration of used vehicles imported irregularly from the United States and Canada. The decision, finalized through a decree in the Official Gazette of the Federation (DOF), effectively repeals a previous extension that would have kept the program active through late 2026.
Since its launch in 2022, the initiative resulted in the regularization of approximately 2.99 million vehicles. While the government originally promoted the scheme as a way to provide legal certainty for owners and improve public security by tracking vehicle ownership, the program faced persistent criticism from the private sector.
Industry leaders, including the Mexican Association of Automotive Dealers (AMDA), have lauded the repeal as a necessary step to stabilize the domestic market. Guillermo Rosales, President of AMDA, stated that the move will ensure an orderly entry of used vehicles and remove a system that he argued encouraged contraband and corruption. For years, automotive dealers maintained that the influx of these low-value units flooded the market and bypassed essential safety and environmental standards.
The impact of the regularization program was particularly visible in Mexico’s northern border states, where the concentration of these vehicles was highest. Data from 2024 revealed a significant disconnect between regional and national sales trends; while Mexico saw a national growth of 10.6% in new vehicle sales, states like Chihuahua and Sinaloa experienced declines of roughly 4.5%. Industry analysts noted that these drops occurred even in regions with strong local economies, suggesting that the availability of regularized “chocolate cars” directly undermined formal dealership sales.
Beyond the immediate impact on sales, critics highlighted broader economic and environmental risks. The lack of oversight on importers raised concerns regarding potential money laundering, while the absence of emissions testing for these vehicles contributed to higher environmental costs. Furthermore, the federal government faced the loss of potential tax revenue that would have otherwise been generated through formal import channels.
With this administrative shift, the importation of used vehicles into Mexico will now be governed strictly by the terms of the United States-Mexico-Canada Agreement (USMCA). This framework imposes specific age limits on vehicles and mandates strict compliance with mechanical and environmental regulations.
This policy change arrives during a period of stabilization for the Mexican automotive industry. Despite some fluctuations in monthly performance throughout 2025, cumulative sales rose by 1% through November. Total sales for the year are projected to reach 1.6 million units, a figure the industry hopes to maintain through the renewed certainty provided by the repeal of the regularization decree.
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