President Trump's application of 25 percent tariffs on Mexican and Canadian goods, including auto parts, will raise average U.S. vehicle prices by around $3,000 each and could reduce 2025 auto sales by 1 million vehicles, Mexico's national supplier association warned.
"The impact of these new tariffs will be reflected in production costs and consumer prices," the National Auto Parts Industry association said in a Feb. 1 press release that included the estimates on higher sticker prices and lower U.S. sales. "The automotive and auto parts industry is one of North America's export engines, supporting more than 11 million jobs between the three countries."
The parts group joined a broad swath of Mexican automotive and manufacturing chambers in denouncing the tariffs, warning that all three countries will suffer from Trump's Feb. 1 executive order. In his first term, Trump renegotiated the 1994 North American Free Trade Agreement to be more favorable to the U.S. The pact was renamed the United States-Mexico-Canada Agreement in 2020, or USMCA.
The Mexican supplier association, which represents more than 700 factories in Mexico, said the country is the No. 4 parts maker globally. In the 2024 calendar year, the group estimated the value of Mexico-made parts at $125 billion. On its website, the group said $91 billion worth of parts were exported in the January-October period last year and 88 percent of those exports went to the U.S.
The Mexican Automotive Industry Association, which represents auto makers operating in the country, said the Trump-imposed tariffs break with 30 years of regional integration by the three North American neighbors under historic free-trade agreements. Those pacts have allowed the region to boost its competitivity versus global rivals, including China, the association said in a press release Feb. 2.
"The United States, Mexico and Canada are stronger together," the auto maker association said. "Measures such as those taken by the U.S. government go against the spirit of integration and collaboration that has given so many benefits to the three countries."
The association said its members include 22 auto makers, including General Motors, Ford, Stellantis, BMW, Nissan, Toyota and Volkswagen. Mexico assembled nearly 4 million vehicles in 2024 and exported nearly 3.5 million, with the vast majority going to the U.S. market, according to government data.
Mexican President Claudia Sheinbaum said Feb. 1 that the country would retaliate with tariffs of its own against the U.S. and would give more details on those measures Feb. 3. Sheinbaum said she also had reached out to the Trump administration for dialogue. The U.S. tariffs against Mexico and Canada are scheduled to go into effect Feb. 4.