The National Auto Parts Industry (INA) highlighted the close link between auto parts production in Mexico and the evolution of the automotive market in the United States, the main destination for components manufactured in the country.

In this context, Julio Galván, manager of Economic Studies at INA, indicated that, despite a challenging environment during 2025, October marked a historic high in the production of auto parts , reaching a value of 10 billion 573 million dollars (mdd) , which represented a growth of 1.52% compared to September.

Speaking about the cumulative figures from January to October, Galván detailed that production reached $99.816 billion , representing a 3.75% contraction compared to the same period in 2014. Even so, he highlighted the sector’s ability to adapt to a volatile global environment, while also emphasizing that October’s data shows favorable trends that could positively influence the year-end performance.

He explained that the performance of the auto parts industry is closely tied to the performance of the U.S. automotive market , both in terms of production and sales, which directly impacts the demand for Mexican components. “The relationship between vehicle production and auto parts production is directly proportional,” Galván explained, emphasizing that fluctuations in the United States have immediate effects on local production.

Galván also presented figures on Mexico’s participation as a supplier of auto parts to the U.S. market. He noted that in October, Mexico’s share of total auto parts exports to the United States reached 46.25% , the highest level on record, and that in the January-October period of 2025, that proportion stood at 43.38% , reaffirming the importance of the Mexican industry in the regional supply chain.

When breaking down production by product type, he mentioned that the five main categories —electrical parts, transmissions and clutches, fabrics and carpets, engine parts, and suspension and steering— constitute 53% of the total value of auto parts production in Mexico.

He also highlighted the geographical distribution of the industry: 43.9% of production is concentrated in the north of the country , followed by the Bajío region with 36% and the central zone with 15.1% , reflecting the productive dispersion and the strategic importance of different states for the sector.

Regarding challenges and opportunities for 2026, Galván stressed that interdependence with the US market will be a key factor , as will the changes in commercial and productive dynamics expected for next year.

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BNSF Railway reiterated that the merger between Union Pacific (UP) and Norfolk Southern (NS) presents serious risks to competition, service and the supply chain .

According to Tom G. Williams, executive vice president and chief marketing officer of BNSF Railway, he noted the above after reviewing the merger application that the companies submitted to the United States Land Transportation Board (STB) on December 19, 2025.

In a letter sent to its customers, it mentioned that the growth promises presented by the companies are unrealistic , since the combined volumes of UP and NS alone have decreased by 13% in the last decade.

However, the first one promises 12% growth in just three years, almost entirely thanks to the conversion of truck carriers to rail carriers.

“STB statistics show that UP already earns more revenue from higher fares than any other Class I railroad. When this growth in truck conversion doesn’t materialize, you’ll pay for their merger premiums with higher fares. The protections proposed by UP are a Trojan horse designed to get their application approved,” he emphasized.

Regarding the Gateway Tariff Commitment proposed by UP, he considered that it excludes almost all shippers . Only 0.4% of all rail freight transport would be eligible. Furthermore, it expires in a few years, “leaving you vulnerable to monopoly pricing.”

Williams also indicated that integration risks exist due to UP and NS’s “trust us” approach, which does not offer fundamental safeguards against serious supply chain disruptions on a much larger scale.

“The last time UP led a merger integration in 2008, the STB had to extend its oversight period twice due to the congestion problems it caused in Chicago,” he recalled.

He noted that the UP-NS merger request cites more than two thousand letters of support , including some 500 from shippers, representing less than 6% of all traffic on the U.S. rail network.

In contrast, the Rail Customers Coalition—which represents carriers of more than half of all rail freight volume—has stated that the merger would create near-monopoly power , increasing costs for manufacturers, farmers, energy producers, and ultimately, consumers. Similarly, the Teamsters Rail Conference and the Brotherhood of Railroad Signalmen , which together represent more than half of all rail workers, warn that the merger would reduce competitiveness and increase safety risks.

“These numbers matter. The voices opposing the merger represent the vast majority of customers and rail workers who interact with UP and NS on a daily basis. As more stakeholders review the application, opposition is growing. The application is so lacking in substance that several key players have already asked the STB to reject it as incomplete. When the STB finally accepts the application as complete, it will publish a timetable that will include a short comment period. This will be your opportunity to raise your voice and protect your interests,” he stated.

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The Mexico-China Chamber of Commerce and Technology believes that the measures announced by the Mexican government to protect the country’s strategic industries, through which it seeks to impose tariffs of up to 50%, will have negative consequences for the development and growth of key industrial sectors and for the supply chains that sustain the competitiveness of products sold in Mexico and around the world.

The organization, made up of Chinese companies with operations in Mexico and vice versa, noted that it proposes imposing tariffs ranging from 10% to 50% applicable to products originating in Asia, classified in more than 1,400 tariff items , including glass, textiles, clothing, steel, aluminum, footwear, household appliances, hygiene products, auto parts, batteries, motorcycles, trailers, and automobiles.

“If it comes to consumer products, these very high increases of 35 to 50% in the import tax will have an unprecedented inflationary impact on products such as textiles, clothing, and footwear,” the agency emphasized in a statement.

He noted that the tax on imported cars would be 50% , with immediate effects on the final consumer price. This would affect access to these vehicles, “which are high-quality, irreplaceable, and greatly needed to advance the energy transition and reduce the emission of pollutants into the Earth’s atmosphere.”

He pointed out that Mexico has become a supplier of unprecedented scale and quality, so the supply chain would also be affected.

“The Mexican government’s proposal to increase tariffs on key segments such as parts and components for motorcycles, automobiles, batteries, engines, among others, constitutes a threat of harm or directly harms the development of the mobility sector, and electric mobility in particular,” he said.

In this regard, he called for a reconsideration of the proposed measures through a thorough and clear analysis of Mexico’s potential to replace these high-tech imports in the immediate future.

“Otherwise, we will be negating any possibility of absorbing, consolidating, and developing technology in the Mexican market for key sectors such as the metalworking industry, auto parts, household appliances, and other sectors that drive inflation control, thereby preserving the remunerative capacity of the minimum wage in Mexico,” he warned.

The Mexican Association of Automobile Dealers (AMDA) stated that the proposed increase will harm the economic and financial viability of a 60 billion peso (mdp) investment in the creation of 800 points of sale for cars imported from China in Mexico, the trade organization added.

In turn, the Electro Mobility Association (EMA) indicated that increasing the cost of electric vehicles will make more than 100 models of this type of vehicle and 50 plug-in hybrid models inaccessible.

In response, the Mexico-China Chamber of Commerce and Technology reiterated its willingness to engage in dialogue with all Mexican authorities to find solutions that address the goals of increased tax revenue.

Furthermore, among other points, he reaffirmed the principles of equity and reciprocity in bilateral trade between Mexico and China , and proposed a gradual and equitable approach that balances the effects on inflation, the creation of quality jobs, and the development and deepening of value chains with a greater degree of binational integration.

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Industry 4.0 , also known as the fourth industrial revolution, is redefining logistics and the supply chain in Mexico, with the use of Artificial Intelligence (AI), digital twins (virtual representations of an object or system), and other technologies that have improved business efficiency.

“One of the biggest impacts has been the digitalization of processes, which enables rapid feedback and real-time visibility throughout the entire supply chain. Previously, adjusting an operation to a change in demand took weeks; today, thanks to these tools, those adjustments can be made in hours, making logistics much more agile and responsive,” explained Carol Prieto , VP of Program Management at Flex , a firm that offers manufacturing and supply chain services.

The specialist emphasized that digitalization has transformed logistics processes , such as the application of these technologies to optimize the filling of interoceanic containers.

“Thanks to digital models and data analysis of weights, dimensions, and other factors, we have been able to identify the ideal cargo combination to maximize space utilization, reduce emissions, and improve logistics resource management,” he explained in an interview with T21.

Another enabler that has improved logistics is digital twins, which, combined with AI, allow for scenario modeling, route optimization , and improved operational efficiency without resorting to traditional manual trial-and-error methods.

Industry 4.0 in supply chains

At Flex, Industry 4.0 is based on two fundamental pillars: smart manufacturing and the use of robots and cobots (collaborative robots) , explained Prieto, who indicated that both elements combine to transform traditional production models and make them more efficient, predictable, and sustainable.

Based on this foundation, supply chains are now more efficient, connected, and secure, and among their benefits is the optimization of physical space .

“The use of robots in warehouses is increasingly common and has significantly reduced storage space, minimized risks for employees, and accelerated operating times. By eliminating the need for wide aisles or manual operations, the use of physical space is optimized and security in the logistics environment is increased,” he noted.

According to Gartner , a consulting firm, the use of robots in warehouses can increase productivity by up to 40 percent and reduce operational errors by 50 percent.

Also, digitalization and the use of AI allow for real-time visibility of the entire operational flow .

“This translates into improved planning capabilities and faster response to changes in demand, disruptions, or customer needs. For example, today we can detect alerts early and eliminate waste throughout the supply chain, from origin to final delivery,” the specialist emphasized.

According to a study by the consulting firm McKinsey & Company , digitalization in logistics can reduce operating costs by up to 30% by improving visibility and efficiency in the supply chain.

“Today, we can know exactly when a load will be ready, which allows us to precisely coordinate the arrival of carriers. This prevents operators from having to make unnecessary trips due to incomplete loads, something that was common before,” Prieto said.

For Carol, technology and better planning “have allowed logistical emergencies to become the exception rather than the rule, which translates, among other things, into less fuel used and better operational efficiency.”

In which sectors is it applied?

In Mexico, sectors such as automotive, telecommunications, data centers, and medical devices are leading the adoption of Industry 4.0. The need for reliable and traceable processes in these industries makes digitalization and robotics essential, reinforcing operational efficiency with human talent.

Sustainability is another benefit of this technology, as optimizing processes reduces energy, material, and time consumption . “Sustainability isn’t an isolated result; it’s a reflection of better-informed, smarter, and long-term processes,” he said.

Regarding smart manufacturing , Carol Prieto said it began with digitalization processes that enabled real-time data capture, connected systems, and enabled traceability throughout the entire value chain . Later, with the incorporation of technologies such as AI, machine learning , and predictive analytics, this digitalization evolved into autonomous, data-driven decision-making.

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