On April 3, 2025, President Donald Trump announced a series of tariffs targeting imports from various countries, a move that has left many international trade partners in a state of uncertainty. However, Mexico, along with Canada, emerged as notable exceptions, avoiding the hefty new tariffs thanks to the existing United States-Mexico-Canada Agreement (T-MEC). President Claudia Sheinbaum expressed her satisfaction with this outcome, highlighting the positive relationship established between the Mexican government and the United States.
During a press conference, Sheinbaum noted, "For Mexico, there will be no tariffs, and that is good for the country, even if some do not want to recognize it. It has to do with the good relationship that we have built between the government of Mexico and that of the United States." The Mexican president emphasized that this relationship is based on mutual respect for both the Mexican people and national sovereignty.
While Mexico has successfully avoided additional tariffs, it will still face a 25% tariff on all goods not covered by the T-MEC. This includes a significant impact on the automotive sector, where tariffs on automobiles exported to the U.S. took effect on the same day as Trump's announcement. Mexico is the largest supplier of automobiles to the United States, with approximately 2.5 million vehicles shipped to U.S. dealerships each year.
Tariffs on auto parts, including essential components like engines and transmissions, are set to take effect no later than May 3, 2025. These tariffs are part of a broader strategy by the Trump administration to impose a 25% tariff on all steel and aluminum imports, which was announced in February and went into effect in March.
Secretary of Economy Marcelo Ebrard stated during the press conference that ongoing discussions with the U.S. aim to address the tariffs affecting the automotive industry and other sectors. He detailed that seven sectors have been exempted from the new tariffs, including agro-food, electronic manufacturing, chemicals, clothing and footwear, medical devices, and machinery. Ebrard claimed that these exemptions protect over 10 million jobs in Mexico.
In 2024, nearly half of Mexico's exports to the United States were conducted under the T-MEC, which has played a crucial role in fostering trade between the two nations. Sheinbaum remarked that ongoing negotiations would continue for the next 40 days to secure better conditions for Mexican exports.
Amidst these developments, Sheinbaum introduced an updated economic strategy known as the Mexico Plan, which includes 18 guiding points aimed at strengthening the national economy. Key components of the plan focus on enhancing domestic vehicle production, increasing national content in the automotive supply chain, and boosting employment opportunities.
Sheinbaum's administration aims to increase vehicle production in Mexico by 10% for national consumption and raise the national content in the automotive chain by 15%. Currently, over 80% of the cars produced in Mexico are exported to the United States, and the president's goal is to ensure that most vehicles consumed domestically are manufactured within the country.
In addition to the automotive focus, the Mexico Plan outlines strategies to enhance food sovereignty, energy independence, and the manufacturing of textiles, footwear, and other essential goods. The plan also aims to attract foreign investment, with the portfolio of investments in Mexico reportedly exceeding $200 billion.
On April 21, 2025, the government plans to launch a single window for investments to streamline processes and encourage economic growth. Sheinbaum's administration is committed to reducing imports and increasing domestic production across various sectors.
Despite the positive reception of the T-MEC exemptions, the looming tariffs on aluminum, steel, and auto parts pose significant challenges for Mexico. Ebrard has acknowledged that approximately 40% of Mexican exports to the U.S. are not covered by the trade agreement and are still subject to the 25% tariffs.
Sheinbaum's government has been proactive in addressing these issues, having seized large quantities of fentanyl to combat drug trafficking and significantly reduced migrant traffic through border controls. These efforts have been part of a broader strategy to strengthen security and maintain favorable trade relations with the United States.
As the relationship between the two nations continues to evolve, Sheinbaum expressed optimism about future negotiations. "We have reached a relationship based on mutual respect, and I believe that with information and dialogue, we will always maintain this for the benefit of both countries and our peoples," she stated.
Looking ahead, experts like Carlos Aguirre have pointed out that the preferential treatment Mexico has received in trade could encourage more companies to enter the T-MEC framework, potentially reducing tariffs in the long run. Aguirre noted, "As more companies enter the T-MEC, fewer tariffs will be paid. Many companies that considered leaving after Trump's election will now stay and try to enter the T-MEC."
In summary, while Mexico has successfully navigated the immediate threat of new tariffs, the government remains vigilant in its efforts to negotiate favorable terms for its exports. The ongoing dialogue with the United States will be critical as both nations work to strengthen their economic ties amidst a shifting global landscape.
