The imposition of 25% tariffs on various Mexican products by the United States has heightened the uncertainty among business owners about investing and threatens the prospects for the relocation of companies to Mexico ( nearshoring ) , warned the rating agency Fitch Ratings .
In its analysis, U.S. tariffs exacerbate macroeconomic concerns for Mexican companies , the firm noted that this uncertainty has already damaged business confidence and threatens to destabilize structural hopes for nearshoring in Mexico.
“Infrastructure and security issues have been constraints. More recently, Mexico’s business environment has been affected by emerging concerns about judicial reform, a weakening fiscal position, energy security and inflation in labor costs,” he said.
The rating agency noted that the industrial and automotive sectors will also feel the effects of tariffs more directly.
In this regard, he stressed that this measure will have an immediate impact on Mexico’s automobile suppliers and on the diversified industrial sector , “given the high level of integration of the supply chain with the United States.”
“Fitch does not expect the automotive industry to completely reorient supply chains to avoid tariffs, as it would take years and may not be financially viable. Mexican suppliers will likely pass on incremental costs to original equipment manufacturers, who will raise prices to compensate. Higher prices will lead to lower sales and production, increasing suppliers’ volume risk,” the study said.
Among Fitch’s rated portfolio of global automakers, Honda , General Motors , Nissan and Stellantis have the largest presence in Mexico and Canada.
The tariff changes will also affect suppliers of critical components for the automotive industry, such as Nemak and Metalsa , which have a significant market share, making them difficult to replace.
In his analysis, he said that an increasingly likely domestic recession would have a widespread impact on other corporate sectors, such as housing, construction and retail.
“Continued currency depreciation would have more idiosyncratic effects, depending on the exchange rate mismatch between debt and EBITDA generation, and domestic-focused issuers are likely to be more negatively affected,” he added.
Fitch estimated that for other Mexican corporate sectors, direct exposure to US tariffs is moderate to low . “Downside risks to earnings estimates are high, as most Mexican companies have not yet incorporated the impact of US tariffs into their earnings guidance.”
Meanwhile, Fitch’s international ratings for Mexican companies are heavily biased toward low to medium investment grade.
With the tariffs coming into effect, Fitch said the scenario is more complicated than more moderate scenarios, which assumed a 25% tariff on a smaller basket of taxable imports, although the duration of the tax remains uncertain.
It is worth remembering that on March 4, the United States began charging a 25% tariff on Mexican products, although this Wednesday the president of our northern neighbor, Donald Trump , paused the tariff on vehicles from Mexico and Canada for a month.
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