Mexico Faces Section 232 Tariffs as Exports Fall 1.6% Pre-USMCA

Mexico enters the year of the USMCA review facing unresolved US tariffs on steel, aluminum, autos, and heavy trucks that continue to pressure trade and investment decisions. The duties, imposed under Section 232 of US law during the Trump administration, remain a central concern for Mexican authorities and industry groups as they prepare for talks with Washington.

The impact is already visible in official data. According to Banco de México, the value of Mexican steel exports to the United States fell 12% between January and October 2025 compared with the same period in 2024. Exports of transportation equipment, a category that includes automobiles and trucks, declined 7% over the same period, raising concerns in sectors that depend heavily on the US market.

Minister of Economy Marcelo Ebrard says that the automotive tariff system allows discounts based on regional content. Under this mechanism, the higher the integration of Mexico, the United States and Canada in a product, the lower the effective tariff rate. While this offers an advantage over non-regional competitors, Mexican industry leaders say it does not resolve the underlying problem. Companies want to operate without tariffs or legal uncertainty.

The Mexican Automotive Industry Association (AMIA) has made the elimination of Section 232 tariffs a priority. “We have a 25% tariff that we have to comply with,” says Rogelio Garza, President, AMIA. “You can discount the American content, but it is not ideal and it is not what we want. We are going to push for zero,” he adds.

On Nov. 1, the Trump administration also imposed a 25% tariff on imports of medium and heavy trucks and their parts, along with a 10% duty on buses. While USMCA-compliant vehicles only pay tariffs on non-US content, Mexican officials and businesses say the measure adds costs and affects future investment plans.

Section 232 allows the US president to impose trade restrictions if imports are deemed a threat to national security. Although overall Mexican exports to the United States rose 7% in the first 10 months of 2025, the Tax Foundation estimates that less than 15% of US imports from Mexico and Canada are subject to these tariffs. Former USMCA negotiators say Mexico’s goal is clear: remove Section 232 duties while keeping the trade agreement intact.

Mexico’s light-vehicle production fell 8.36% year over year in November to 322,205 units. Vehicle exports also declined during the month, down 3.45% to 279,342 units, or 9,967 fewer vehicles than in November 2024. On a cumulative basis, exports totaled 3.16 million units in the first 11 months of 2025, a 1.63% annual decline and the first cumulative drop for this period in five years. 

Despite the decrease, Adriana Ramírez, Manager of Economic Studies, AMIA, says the result still ranks as the third-highest export volume on record for January–November. “Despite the 1.6% decline versus 2024, the first 11 months of 2025 stand as the third-best historical record,” she says, noting that only 2018 and 2024 posted higher figures.

Data from INEGI, which compiles information from 22 automakers affiliated with AMIA and eight non-affiliated manufacturers representing 41 brands, shows that 78.6% of vehicle exports in November were destined for the United States. The remaining 21.4% went to markets including Canada, Germany, and Colombia. The production and export declines come amid growing uncertainty over the upcoming USMCA review, a process expected to influence the future structure of North American automotive supply chains.