Every year, thousands of cars without legal California license plates pour across the border into Mexico.
The vehicles, often older models, are popular with lower-income workers who can’t afford to pay federal import fees or buy new vehicles.
But Baja California officials say they’re popular for another reason: because no one can identify them, the cars are often used in crimes. State officials claim that more than 80 percent of crimes in Baja are committed in unregistered vehicles.
“That, of course, does not mean that all the drivers of all cars that are illegal are driving around committing crimes,” said Mario Escobedo Carignan, Baja California’s Secretary of Sustainable Economy and Tourism. “But certainly the vast majority of cars involved in crime are these illegal cars.”
That’s why state authorities have proposed registering more than half a million vehicles illegally imported into Baja California from the United States.
Critics of the plan, including Mexico’s federal government, say registering the illegal vehicles will deliver a blow to Mexico’s automotive industry, causing new car sales to decline.
Government officials, Mexican newspapers and residents call unregistered cars “auto-chocolates.” The term comes from a childhood game in Mexico that allows a player (usually someone’s younger brother) to participate in a game but not count as a “real player.” That player is known as a player de chocolate. He gets to play the game, but none of his actions count for or against his team, so he’s a “fake” player.
The vehicles in question are typically older model U.S. cars, or salvage-title cars — that is, ones considered a total loss by insurance companies — that have changed ownership several times and then made their way south of the border.
The cars are usually sold informally on the street between a buyer and seller, circumventing import fees. Used cars sell anywhere from $800 to $8,000, with the typical cost of a used car in Mexico being about $3,500. By comparison, the average cost of a used car in the U.S. in 2020 was $20,000, according to Statisa.
Once the cars are in Mexico, there’s no way to legalize or register them because they’re considered federal contraband. Local and state police don’t have the authority to cite the owners for not paying the federal fees.
“The only way to legalize them would be to send them back to the U.S. and import them properly, legally,” explained Ernesto Elorduy, a car dealer who is also the president of Coparmex Mexicali, an organization for business owners.
Baja California Gov. Jaime Bonilla and Escobedo have proposed allowing illegally imported vehicles to be registered with the state, for about 3,600 pesos, or $163.
Escobedo estimates there are currently between 500,000 and 700,000 of the illegal vehicles just in Baja California. “But your guess is as good as mine,” he said.
Critics, including new-car dealers, say that allowing state registration will only encourage more southbound car trafficking. Elorduy, the president of Coparmex Mexicali, a local organization for business owners, said the problem needs to be addressed more holistically.
He said Mexican customs agents are not supposed to allow unregistered California vehicles to enter the country, but “Mexico has a very porous border and corrupt customs system, and it’s been corrupt for generations.”
They are also often permitted by U.S. customs agents to cross back northbound into the United States on a daily basis when the owners of the cars work north of the border, even though it’s technically illegal.
A thriving illicit industry has grown up around the “auto-chocolates.”
To help drivers avoid detection by authorities, businesses in Baja California openly sell counterfeit license plates for around $50 to $60.
Even wealthy people purchase the fake license plates, because they are cheaper than obtaining real ones by registering their vehicle with the state.
Drivers of illegal cars or those with fake plates are rarely cited for registration violations because it’s considered a federal crime, not a local or state issue. Federal law enforcement authorities typically have bigger issues to tackle than traffic citations.
So why not go after those selling the counterfeit plates?
“The businesses that sell the fake license plates … have enough customers that they have a huge amount of political power,” explained Elorduy. Also, any suggestion of registering vehicles prompts protests from lower-income workers.
“It’s not a good look for a governor or mayor to crack down on these workers who don’t have any money. They can barely afford their $1,000 car or $1,500 and now you’re going to come along and take away their only means transportation,” he said.
Elorduy’s organization supports a solution that includes stopping the vehicles from crossing the border and improving the public transportation system.
“We have many more cars here per capita than other parts of the country, and it’s not like they’re getting smog-checked. They’re billowing black smoke all the time. We’re going to be condemned to poor air quality as long as we have chocolates,” he said.
The proposal to register the illegal vehicles will need the approval of Mexico’s federal government and “it is going to be a tough sell,” said Escobedo. A 2019 federal bill to legalize the vehicles at a national level was rejected by Mexico’s Senate in October 2019.
“The federal government is against trying these types of programs because they believe it will bring invalid cars into Mexico or encourage people to bring more invalid cars into Mexico,” said Escobedo. “What we want is a program that can regularize and provide valid state license plates to the cars that are already here in Baja.”
When the 2019 legislation was introduced, Guillermo Rosales, then deputy director general of the Mexican Association of Automobile Dealers, estimated that sales of new cars would plummet by 30 percent. Sales of new cars in Mexico already were falling, by 12.1 percent in September 2019 compared with a year earlier, according to Mexico’s National Institute of Statistics and Geography.
Elorduy, the dealership owner, doesn’t believe the registration process would impact new-car sales, because most of the people who drive the illegal cars are not typically in the market for buying a new vehicle.
“New cars in Mexico are more of a luxury for upper-middle class incomes whereas chocolates are driven more by lower-income workers,” he said. “They would be competing more with used cars sales or even public transportation.”
But Escobedo said because of the unregulated system, people who try to purchase cars in Mexico can easily become victims of fraud. He said buying a stolen car in Mexico is a crime even if the person purchasing the vehicle is unaware.
Escobedo recommended checking CarFax, a company that supplies vehicle history, before purchasing vehicles in Baja California.
“They’ll sell you a car and then report it stolen five minutes later,” he said.”Or maybe that car was used in a crime and that’s why they’re selling it.”