Due to the impact of U.S. tariffs, Mexico's car exports saw a sharp decline in September.
路透社2026/10/08 11:11INEGI data shows that in September, auto exports fell 12% year-on-year. During the review negotiations of the US-Mexico-Canada Agreement (USMCA), Mexican automobiles continue to face effective US tariffs of 10% to 12%. Domestic auto sales in September grew by 8%, helping to ease pressure on the industry. Sarah Morland, Reuters, Mexico City, October 8 – Data released by the Mexican National Institute of Statistics and Geography (INEGI) on Wednesday showed that the country’s auto exports in September recorded their biggest drop so far this year. Analysts believe this decline is due to US tariff policies—the US is the largest market for this sector in the Latin American country. In September, Mexican auto exports dropped 12% year-on-year, marking the largest decrease since December 2025, while production plummeted by 15%. However, domestic sales grew by 8%, which to some extent eased the pressure on this crucial manufacturing sector. The data was released as government officials are reviewing the US-Mexico-Canada Free Trade Agreement. Even as negotiations continue, Mexican automobiles are still subject to a 25% tariff. Mexican officials estimate that complying with the requirement to use North American-made parts can reduce the tariff burden to 10%-12%. After over thirty years of consecutive free trade agreement signings, the two countries’ economies have become tightly entwined. However, the abrupt policy changes and tariff measures during the Trump administration shook business owners’ trust in long-established supply chains. “This brings greater uncertainty for automakers and impacts production and export decisions,” said Janeth Quiroz, Director of Economic Analysis at Monex. She warned that Mexico’s dependence on the US market represents the biggest risk to the industry. “The September data is a warning, not a crisis signal,” she said. “If this trend continues into 2027, then we may indeed face deeper structural problems in Mexican manufacturing.” Last year, General Motors announced a $4 billions investment to shift some production from Mexico to the US in response to volatile tariff policies. This Chevrolet maker, along with Ford and Nissan, saw a significant drop in exports in September. Mercedes-Benz closed its joint venture plant with Nissan in May last year, and last month did not produce or export any cars—the first time this has happened since the company began shipping overseas eight years ago. However, other companies filled this gap, most notably South Korea’s Kia, Germany’s BMW, and Japan’s Mazda, with Mazda’s exports more than doubling in the month. The main auto industry association in Mexico, AMIA, emphasized at a press conference on Wednesday that Mexico remains the largest source of US auto imports, supplying 16% of light vehicles in an American market that has shrunk by 2% so far this year. AMIA data shows that although exports to the US fell by 5% in the first nine months of 2026, Canada—Mexico’s second largest market—increased its purchases by more than 9%. Alejandra Vargas, an analyst for Ve Por Mas (Bx+), warned that the ongoing slowdown in growth could impact automakers’ investment decisions and affect both Mexico’s manufacturing activity and overall economic growth. “The development of Mexico’s trade relationship with the US in the coming months will continue to be the main factor determining the direction of the industry,” she said.
Sarah Morland
Reuters Mexico City, October 8 - Data released Wednesday by the Mexican National Institute of Statistics and Geography (INEGI) showed that the country's car exports in September saw the largest drop so far this year. Analysts attribute this decline to US tariff policies — the United States is the biggest market for the largest industrial sector in this Latin American country.
In September, Mexican car exports dropped 12% year-on-year, marking the steepest decline since December 2025, while production plummeted by 15%. However, domestic sales grew by 8%, partly alleviating the pressure on this crucial manufacturing sector.
The release of the data comes as government officials are reviewing the United States-Mexico-Canada Agreement (link), but even as negotiations continue, Mexican cars still face a 25% tariff. Mexican officials estimate that complying with rules requiring the use of North American-made parts could reduce the tariff to 10%-12%.
After more than thirty years of consecutive free trade agreements, the two countries' economies are closely intertwined, but abrupt policy shifts and tariffs during the Trump administration shook business owners' confidence in long-established supply chains (link).
"This increases uncertainty for automakers and affects production and export decisions," said Monex Director of Economic Analysis Janeth Quiroz. She warned that Mexico's reliance on the US market is the industry's greatest risk.
"The September data is a warning signal, not a crisis signal," she said. "If this trend continues into 2027, then we could indeed be facing deeper structural problems in Mexican manufacturing."
General Motors announced last year that it would invest $4 billion (link) to shift part of its production from Mexico to the US in response to turbulent tariff policies. The Chevrolet maker, along with Ford F.N and Nissan 7201.T, also saw sharp declines in exports in September.
Mercedes-Benz MBGn.DE closed its joint venture plant with Nissan in May last year and did not produce or export any cars last month, the first time this has happened since the company started overseas deliveries eight years ago.
However, other companies filled the gap, particularly South Korea's Kia 000270.KS, Germany's BMW BMWG.DE, and Japan's Mazda 7261.T, with Mazda more than doubling its exports for the month.
Mexico's main auto industry association, AMIA, emphasized at Wednesday's press conference that Mexico remains the largest source of US auto imports, supplying 16% of light vehicles to a market that has shrunk by 2% so far this year.
According to AMIA data, although exports to the US fell 5% in the first nine months of 2026, Canada's purchases — Mexico's second-largest market — grew by more than 9%.
Ve Por Mas (Bx+) analyst Alejandra Vargas warned that a sustained slowdown in growth could affect automakers' investment decisions and spill over into Mexico's manufacturing activity and overall economic growth.
"The evolution of trade relations between Mexico and the United States in the coming months will remain the key factor determining the direction of the industry," she said.
(To facilitate non-native English speakers, Reuters provides its reports in several other languages using automated translation. As machine translations may contain errors or lack required context, Reuters does not guarantee the accuracy of such texts and offers them solely as a convenience for readers. Reuters accepts no liability for any damage or losses caused by use of the automated translation feature.)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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