Mexico’s Auto Sector Wary Despite US Tariff Reprieve

The three-month delay in the imposition of a 30% US tariff on Mexican exports has been welcomed by Mexico’s automotive industry, though the sector remains cautious. According to Guillermo Rosales, President of the Mexican Association of Automotive Dealers (AMDA),  uncertainty over US trade policy will persist until the renegotiation of the United States-Mexico-Canada Agreement (USMCA), expected in 2026.

Speaking at a press conference on automotive financing and market performance, Rosales said that while the postponement offers short-term relief, it does not resolve broader concerns about trade conditions between the two countries.

“The good news is that there is no worsening or tightening of tariffs on Mexican products. The bad news is that this environment of uncertainty remains. I believe it will continue through 2025 and into 2026 until the USMCA renegotiation is concluded,” Rosales said.

He acknowledged the intervention of Mexican President Claudia Sheinbaum in securing the delay. “We recognize President Claudia Sheinbaum’s efforts in convincing President Donald Trump to postpone the application of the 30% tariff for three months,” he added.

Currently, US tariffs affecting Mexico include a 25% duty on vehicles that enter outside the USMCA framework, 50% on steel, aluminum, and copper, and 25% on fentanyl-related substances. Auto parts remain exempt from these measures.

“The results at the close of the first half of the year and those expected for July are not placing us in a serious crisis or catastrophic decline in production, exports, or domestic sales. But they are pointing toward stagnation,” Rosales noted.

He added that Mexico’s economic growth has not been sufficient to offset the slowdown in the auto sector. “The GDP increase in the second quarter of 2025, which came in slightly above 2% and exceeded analyst expectations, is not enough to reinvigorate one of the economy’s key engines—vehicle acquisition,” he said.

Rosales stressed that the lack of clarity on future trade conditions, particularly regarding the USMCA, is restraining growth in the domestic light vehicle market. “This uncertainty is a negative factor when trying to forecast meaningful industry growth. It is also a drag on a broader economic recovery,” he concluded.