Following the December 2025 decree imposing 5-50% tariffs on non-FTA imports, Mexico's measures particularly target the automotive sector, hiking duties on light vehicles to 50% and parts up to 50%. While aiming to protect national industry and generate over 70 billion pesos in revenue, the policy draws criticism for slowing Chinese EV tech adoption, though brands remain bullish on Mexico's market thanks to local plants.
The decree affects nine automotive tariff fractions from countries like China, India, South Korea, Brazil, and Russia. Light vehicles now face 50% tariffs (previously 15-20%), with auto parts duties up to 50% based on components.
Economy Secretary Marcelo Ebrard anticipates minimal 0.2% inflationary impact. Chinese automakers contend with perceptions of lower quality in entry-level models, relying on complex parts strategies and warranties, yet offer prices 30% below rivals.
Many Chinese brands operate plants in Mexico, balancing imports with exports to maintain competitiveness. The Electro Mobility Association (EMA) warns that 50% tariffs hinder Chinese technological progress in the market. Despite challenges, Chinese firms express confidence in sales growth and long-term positioning in Mexico.
