Mexico has established itself as a major producer and supplier to the automotive industry, which is currently experiencing uncertainty surrounding the revision of the United States-Mexico-Canada Agreement (USMCA) . Manuel Montoya, director of the Nuevo León Automotive Cluster (CLAUT) , stressed that northeastern Mexico is emerging as a key region for strengthening the automotive supply chain.
In this regard, he highlighted that this area concentrates the majority of the country’s Tier 2 supply.
“The northeast region is primarily home to Mexican-owned companies that work for major automakers and top-tier suppliers. It’s a landscape that needs to be strengthened because it’s at the heart of national integration,” he stated.
Although production remains stable, new investments are on hold while the future of the negotiations is defined , warned Manuel Montoya, as they are waiting to see what happens with the rules of origin in this treaty.
“The sector continues to produce and export; we’re even at the same pace as last year and could close with four million vehicles manufactured in Mexico. However, new projects and models are on hold, awaiting clarity on the rules,” Montoya explained.
The demand to integrate more regional content has put pressure on international automakers, which in turn opens up opportunities for local suppliers.
Previously, some automakers preferred to pay a tariff for failing to comply with the rules of origin; today, with the threat of tariffs of up to 27.5% , that strategy is no longer viable.
“It’s no longer viable to rely on components from Japan or Germany. Corporations are pushing their plants in Mexico to find suppliers, and we see frequent requests in our region for processes such as plastic injection molding and machining. This represents a great opportunity for companies in the northeast and Mexico,” he explained.
Montoya also warned about other factors that directly impact the sector, such as the exchange rate, which affects the competitiveness of exporters, and electromobility, which requires investment in infrastructure and battery production in North America to reduce dependence on China.
Review of the USMCA: tensions and pending definitions
In this regard, Montoya anticipated that the treaty revision will bring pressure on two fronts: relaxing rules of origin , as some U.S. automakers are seeking; and tightening requirements , a position of regional governments seeking to maintain jobs and local content.
Added to this is the uncertainty surrounding China’s role in the North American market .
“Chinese companies have held back on their decision to set up plants in Mexico because it’s unclear whether they will be able to export their vehicles to the United States. This will be a key aspect of the negotiations,” he warned.
Regarding the Mexican government’s recent move to impose tariffs on Chinese vehicles, Montoya considered it a necessary action to level the competitive playing field.
“It’s logical that we ask for the rules to be changed, because these vehicles arrive with subsidies and under dumping conditions. We can’t give away our industry. Chinese cars have good technology and prices, but they must compete on a level playing field, also generating jobs and investment in Mexico,” he said.
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