Taiwan Imports Fuel Mexico’s AI-Related Export Surge

Mexico’s technology exports surged 118% in 2025, driven by the regionalization of Taiwan-led supply chains and USMCA-integrated assembly for AI-related hardware. This expansion, centered on high-value components and assembly by firms like Foxconn and Quanta, positions Mexico as a critical intermediary for US advanced computing needs despite domestic infrastructure and regulatory bottlenecks. The transition signals a structural shift where tech imports from Taiwan, now nearly 50% of Mexico's total, are displacing Chinese influence to solidify North American manufacturing synergies.  

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Mexican tech exports' surge is closely linked to a surge in its tech imports from Taiwan, which accounted for 35% of Mexican tech imports in 2025, reports Switzerland-based UBS. The firm notes that this signals Mexico’s attractiveness for AI-related hardware assembly, positioning the country as an integral intermediary for Taiwanese production destined for the North American market. 

A recent UBS Economic Perspectives report highlights a significant shift in Mexico's export landscape, with technology emerging as the primary driver of growth. Despite a 0.6% expansion of the Mexican economy in 2025 and nominal contractions in traditional export sectors like automotive, oil, and agriculture, non-auto manufacturing exports rose by 17.3%. This increase was almost entirely fueled by computers and electronics, which experienced 118% year-on-year growth and accounted for 90% of the total expansion in non-auto manufacturing exports.

This surge in Mexican tech exports is closely linked to a substantial rise in tech imports from Taiwan. Last year, Mexico's tech imports in specific categories jumped 171%, led by a 276% increase in imports from Taiwan. Taiwan supplied 38% of Mexico's tech imports throughout 2025, and this share rose to nearly 50% by the fourth quarter, largely displacing China as a primary supplier. These import patterns illustrate Mexico’s role as an intermediary in Taiwan-led supply chains for semiconductors and advanced computing. “The picture that emerges is one where Taiwanese firms are using Mexico as a platform to assemble the products they import from their home country to then export them to the US. This is nearshoring at work,” reads the report.

Several factors contribute to Mexico’s strategic position as a conduit for Taiwanese exports to the United States. The regionalization of trade and the USMCA membership provide a preferential platform for production. Additionally, US cloud giants have shown a preference for moving some AI hardware production closer to home to mitigate logistical and geopolitical risks. The US CHIPS Act has also pushed for a domestic advanced computing ecosystem, which Mexico has integrated into via Taiwanese investment. 

The report notes that Taiwanese firms such as Foxconn, Wiwynn, Pegatron, Quanta, and Inventec have established assembly sites in Mexico, thereby facilitating Mexico's move up the value-added export chain. For instance, computer boards from Taiwan are shipped to Mexico for assembly into racks before being sent to US cloud providers. Foxconn is notably constructing a chip-manufacturing facility in Guadalajara to assemble GB200 AI superchips, further integrating Mexico into the global AI supply chain. Beyond final assembly, intermediate processes of the AI server workflow have migrated to Mexico, allowing greater value-added to remain within North America. 

While Mexico's tech sector is expanding, its overall market share of US manufacturing imports improved only marginally last year, primarily because a shift away from auto imports weighed down gains in other areas. Conversely, Taiwan emerged as the largest market share gainer in US manufacturing imports, driven by its dominance in advanced electronics for AI and cloud infrastructure. However, the report suggests that headline US trade data may materially understate Taiwan’s true penetration, as a growing portion of Taiwanese value-added enters the US through Mexico under the USMCA framework. 

The USMCA Review: Potential Risk in Mexico-Taiwan Trade Relations
UBS notes that the strengthening connection between Mexico and Taiwan, which saw bilateral trade reach US$48.3 billion last year, faces potential risks. Upcoming USMCA negotiations could lead to more permanent tariffs or tightened rules of origin and minimum content requirements, which might render Mexico less competitive or, conversely, bolster the connection by moving more of the supply chain workflow to the country. Furthermore, a bilateral trade deal between the United States and Taiwan involves a US$500 billion investment commitment in the US, which risks reducing Taiwanese investment in Mexico.

Global conditions also present challenges, such as the ongoing Middle East crisis. Taiwan relies on gas for 45% of its electricity, and a continued conflict could pose price risks to industrial supply chains. Additionally, a global shortage of helium, critical for AI semiconductor production, has been exacerbated by the conflict in Qatar. Domestically, Mexico continues to face energy and water bottlenecks that could limit future investment from Taiwanese firms. 

National Challenges Halting Taiwanese Investment
Beyond macroeconomic trends, Violeta Hsu, Representative, Economic and Cultural Office of Taipei in Mexico, told MBN that there are some administrative and operational barriers that Taiwanese boards of directors prioritize when evaluating Mexico. Aside from public security, the top concerns include operational flexibility regarding visas, where the current requirement for short-term visits creates significant bottlenecks for immediate staffing and training needs. Achieving visa-free status is a critical expectation to improve agility, the office says. 

Navigating the complex layers of Mexican government for land, environmental, and utility permits also remains a challenge, making a Single Window system essential to further promote investment and prevent factory setup delays. “The process of securing an interconnection agreement to the national grid is very slow. Even if a factory is built, it might sit idle for months waiting for the "switch" to be turned on. This is a massive dead capital risk,” the office told MBN. 

Strategic Synergies Still Exist
Despite these challenges, the complementarity of the current relationship is noted, as Mexico’s rise in its share of Taiwan exports has occurred alongside gains in the US market share over the past two years. 

Taiwanese firms have largely adopted a twin planting strategy, where Mexican productive facilities are paired with US industrial plants, the former handling larger volume production and the latter more focused on circumventing specific tariffs. The focus of Taiwanese investments in Texas and the US Southwest helps create industrial synergies with Mexico. “The fact that Taiwanese ODMs have increasingly focused their US investments in Texas and the US Southwest helps in creating industrial synergies with Mexico,” notes the report.