Key facts
- Mexico's economy minister stated new U.S. tariffs will not affect the country due to USMCA exemptions.
- Approximately 85% of Mexican exports to the U.S. will remain tariff-free.
- New U.S. tariffs will apply to goods previously covered by an expiring Trade Act measure.
- U.S. and Mexican officials will hold a fourth round of USMCA talks in early September.
- Key sticking points in negotiations include U.S. demands for vehicle content and Mexico's request to adjust Section 232 tariffs.
Mexico's economy minister, Marcelo Ebrard, stated that new U.S. tariffs will not impact the country's effective tariff rates, as exemptions under the U.S.-Mexico-Canada Agreement (USMCA) will keep approximately 85% of Mexican exports to the U.S. duty-free. The new duties will apply to a further 10% of goods previously covered by an expiring Trade Act measure, maintaining existing tariff treatment for these items.
U.S. and Mexican officials are scheduled to hold a fourth round of negotiations to renew the USMCA in early September, following a third round of talks aimed at narrowing differences on key issues. Mexican President Claudia Sheinbaum has been actively involved in discussions, having previously argued against tariffs on Mexican goods. U.S. Trade Representative Jamieson Greer anticipates provisional USMCA agreements by the end of 2026, with more complex negotiations on rules of origin and labor commitments expected to extend into 2027.
Significant disagreements persist, particularly regarding Washington's demand for vehicles to contain 50% U.S. content to qualify for preferential market access, a proposal Mexico finds unacceptable. Mexico is also seeking adjustments to U.S. Section 232 national security tariffs on autos, steel, and aluminum before making concessions.