According to Bloomberg, Luis Rosendo Gutierrez, Mexico's Deputy Minister for Foreign Trade at the Ministry of Economy, stated that Mexico is working to increase the proportion of locally manufactured auto parts that meet U.S. origin standards. The goal is to mitigate the impact of the Trump administration's tariff policies on Mexican automobile exports.
As the second-largest economy in Latin America, Mexico is actively taking steps to protect its automotive exports to the U.S. Under the United States-Mexico-Canada Agreement (USMCA), automobile exports are one of Mexico's most important trade sectors. However, in the face of the U.S. imposing a 25% tariff on a wide range of imported goods, Mexico must seek new strategies to adapt.
Speaking at the recent Bloomberg Insights and Innovation Summit held in Mexico City, Gutierrez said, "In the auto manufacturing sector, Mexico is looking to increase the U.S.-origin content within vehicles under the current tariff framework by optimizing certain aspects of the production process. This would allow for greater tariff exemptions."
Gutierrez predicted that the USMCA, signed during Trump's first term, would be reinforced. However, he emphasized that Mexico hopes to establish a more effective dispute resolution mechanism within the USMCA framework. He also previously noted that the USMCA review originally scheduled for 2026 could be initiated earlier during Trump's second term.
"In the coming years, we will continue to face tariff-related challenges and must adapt to a new model," Gutierrez said. "In this model, the key is not achieving zero tariffs but ensuring that U.S. tariffs on Mexican products remain among the lowest compared to global competitors. This is the goal Mexico is working toward every day."
Mexican policymakers have stated that, ahead of the May 3 deadline for the Trump administration's automotive parts tariff measures to take effect, they will continue consultations with U.S. officials on issues related to steel, aluminum, and auto tariffs.
Judith Garza Rangel, a coordinator of the business advisory group "Cuarto de Junto," added that possible progress before the deadline could involve U.S. tariffs on three key product categories, U.S.-China relations, and the forthcoming USMCA review process. The advisory group is currently developing a package of technical adjustment proposals for the Ministry of Economy to support Mexico's USMCA negotiations.
Garza Rangel, who also serves as Senior Institutional Director at steelmaker Ternium, noted that businesses affected by U.S. tariffs are assessing the impact of U.S. trade policies. Ternium, in particular, is enhancing its awareness and adaptability through cost control, efficiency improvements, and employee training programs.
Rogelio Garza Garza, Executive President of the Mexican Automotive Industry Association (AMIA), stated that the ongoing dialogue surrounding tariffs could lead North American nations to conduct a comprehensive review of the USMCA earlier than scheduled. "We are approaching the USMCA review stage, and the current situation is pushing us in that direction. I believe accelerating this process will help eliminate uncertainty and reach agreements. We must continue working to uphold the USMCA," said Garza.
He also expressed confidence in a successful agreement between Mexico and the U.S. on the automotive sector, emphasizing that the current U.S. tariff proposal on auto parts is "unsustainable in the long term."
