BMI forecasts a 12.2% growth in vehicle sales in Mexico in 2015 on the back of 13.0% increase in passenger car sales and 10.7% growth in the commercial vehicle segment. We also forecast production growth to accelerate, growing 7.2% over the year, spurred on by 6.3%, 8.8% and 5.4% increases in the passenger car, light commercial vehicle (LCV) and heavy truck segments, respectively.
Household spending has continued to grow in recent quarters, indicating that private consumption has fully recovered from the shock effect of tax rises in early 2014. Consumer confidence and purchasing power will also be boosted by growing employment created by the resurgence in manufacturing activity and recovery in the country's construction sector.
A government ban on used car imports has also provided a strong boost to new vehicle sales by pushing would-be pre-owned vehicle buyers into the new vehicle markets. This will continue to support sales volumes in 2015 and beyond. We also expect cheaper, entry-level segments of new vehicles to outperform other vehicle classes owing to their attractiveness to buyers that would have otherwise looked for cheaper used vehicle models.
In the LCV segment, we also expect sport utility vehicles (SUVs) and, to a lesser extent, pick-ups to outperform van segments, owing to the SUV and pick-up sub-segments both benefiting more from the uptick in private consumption in the country.
Sales of heavy trucks will also return to strong growth in 2015 as the market shakes off the effects of oversupply in 2013. Owing to low base effects of low sales during H114, sales will expand in H115 and will remain in positive territory over the remainder of the year as activity in the country's manufacturing and construction industries expands. We forecast heavy truck purchases to increase by 6.0% over the year.
Between 2015 and 2019, we also expect light vehicle production to remain in a steady growth phase as US demand for Mexican exports continues to build and new productive investments by major global original equipment manufacturers are ramped up and brought online. Ongoing momentum in the domestic vehicle markets will also provide further stimulus to production. In 2015, we are forecasting 6.3% growth in passenger car production to 2.04mn units and 8.8% growth in LCV production (including SUVs) to 1.42mn. Over the 2015 to 2019 period, we project growth in passenger car production to average 7.1% annually and LCV output to expand 7.9% per year on average.
Furthermore, we expect truck production to also continue benefiting from increased US demand for heavy commercial vehicle exports. We forecast truck production to average an increase of 5.4% annually up to the end of our five-year forecast period in 2019, with output eventually reaching 223,000 units.
BMI maintains a bullish outlook on the Mexican autos industry as a number of factors continue to attract auto investment in the country, particularly for export-oriented production. Most importantly, low labour costs combined with increasing productivity levels and a proximity to major North American markets make Mexico an attractive production hub. A high number of free trade agreements, including the North American Free Trade Agreement (NAFTA) and a comparative weakness in the productive capacity of Mexico's regional competitors, particularly Brazil, also make trade a regional outperformer. Furthermore, over 2015, relative weakness in the peso against the US dollar will also serve to make exports more competitive.