Mexico Plans Higher 2026 Tariffs on Chinese Autos

This week, Mexico plans higher tariffs on Chinese auto imports in 2026 to protect domestic producers amid US pressure. Mazda cuts exports amid USMCA rules impacting production and US market access, while Tesla’s EU sales drop 47% despite market growth. BYD reports its first profit decline in three years. Honda Mexico marks 40 years with a new motorcycle launch. Nissan and Isuzu receive 2025 sustainability awards, and Michelin’s plant in Leon is named its most modern, sustainable facility.

Start your engines, this is the Week in Automotive!

Heavy Vehicle Leasing is Evolving Alongside the Market

Leasing is becoming increasingly attractive as it allows clients to avoid long-term commitments and large capital investments, explains Mauricio Medina, TIP México, General Manager. “Clients can use vehicles for the periods that suit them best, renew if the project works, or simply return them if it does not.”

Mexico Proposes Higher Tariffs on Chinese Auto Imports in 2026

President Claudia Sheinbaum is set to propose increased tariffs on Chinese auto imports, including autos, textiles, and plastics, as part of the 2026 economic package to be presented to Congress on Sept. 8. The measure aims to safeguard domestic producers and address pressure from the United States to tighten restrictions on Chinese goods.

Suzuki Ends Ignis Sales in Mexico, Bets on Dzire Sedan

Suzuki will discontinue the Ignis model globally as the company shifts focus toward more efficient powertrains and responds to market demand for subcompact sedans. The model was also not compatible with mild-hybrid systems, a technology Suzuki is now prioritizing. 

Mazda Exports Fall 28%; US Tariffs Undermine USMCA Edge

Mazda is reassessing its export strategy from Mexico as changing trade conditions and strict regional content rules under USMCA challenge its reliance on the US market. Miguel Barbeyto, President, Mazda Mexico, says that both production and exports from the Salamanca plant are declining. 

Tesla Faces 47% EU Sales Drop in August Despite Growth

In August 2025, Tesla recorded a 47.3% year-on-year drop in car registrations across key EU markets, contributing to a broader 44% decline over the first seven months of the year. Newly released data shows Tesla registrations fell 47.3% in France, 84% in Sweden, 42% in Denmark, 50% in the Netherlands, and 4.4% in Italy. This steep decline contrasts with overall market growth, including a 2.2% increase in France’s auto sector and a 6% rise in Sweden’s.

Mercedes-Benz Adjusts EV Production Amid Misjudged Demand

Mercedes-Benz has formally acknowledged a strategic miscalculation in its approach to EVs, signaling a shift toward a more flexible production strategy. “We overestimated how quickly our customers would be willing to embrace electric mobility,” says Mathias Geisen, Head of Sales, Mercedes-Benz. The company will now adjust by offering both electric and internal combustion engine (ICE) models. 

VW Brazil Hit with US$30 Million Fine for Amazon Labor Abuses

Volkswagen’s Brazilian subsidiary has been ordered to pay US$30.44 million in damages after a labor court ruled the company subjected hundreds of workers to slavery-like conditions on a ranch in the Amazon during the 1970s and 1980s. The ruling, issued by the Labor Court in Para, is the largest fine of its kind in Brazil’s history.

Building a Local, Inclusive Future for Urban Mobility

Zacua aims to develop vehicles that address Mexicans needs in terms of urban mobility, offering compact, accessible vehicles, says CEO Nazareth Black. “Vehicles sold in Mexico are generally not designed with the specific needs of Mexicans in mind; they are often adaptations or “tropicalizations” of models created for other markets.“

Michelin’s Leon Plant Named Most Modern and Sustainable

Michelin’s tire plant in Leon, Guanajuato, has been recognized as the group’s most modern and sustainable facility worldwide, following a visit by Mexico’s Ministry of Labor and Social Welfare (STPS). Positioned as a benchmark in green manufacturing, the plant operates entirely on non-CO2-emitting energy sources.

BYD Reports First Quarterly Loss in Over Three Years

BYD, the world’s largest EV manufacturer, reported a 29.9% decline in second-quarter net profit — the first drop in over three years — as Chinese government efforts to curb destructive price competition take effect.

3M Boosts Mexico Hub for Consumer, Auto, Aerospace

3M Mexico, a subsidiary of the US-based conglomerate 3M, is increasing its investments in innovation to strengthen its position as a manufacturing and export hub for Latin America. “Innovation investments never stop, and they are not only for developing new products but also for improving production processes and integrating new technologies,” says Javier Lostao, Business Director, Consumer Group, 3M Mexico.

EU Proposes Tariff Swap to Ease US Car Export Duties

The European Commission has formally proposed removing tariffs on a range of US industrial goods in exchange for reduced US duties on EU car exports, implementing a key element of a bilateral trade agreement reached on July 27 between US President Donald Trump and European Commission President Ursula von der Leyen.