Introduction
The National Association of Auto Parts Manufacturers (INA) estimates that a 50% tariff on steel and aluminum auto parts from Mexico will have a significant impact of 6,289 million dollars on the US auto parts and components industry.
Importance of Mexican Imports
The United States imports 31,439 million dollars worth of steel and aluminum auto parts globally. Of this amount, Mexico specifically accounts for 38.99% of these imports, while Canada represents 20.55%. Combined, Mexico and Canada make up 59.54% of the total US imports.
Tariff Details and Impact
Julio Galván, the economic studies manager at INA, explained that the 50% tariff imposed by President Donald Trump will negatively affect the competitiveness of the North American region, automatically increasing the costs of auto parts and vehicles in the US.
In 2024, the US imported 12,577 million dollars worth of auto parts containing steel and aluminum from Mexico. With the 50% tariff, an additional 6,289 million dollars in costs will be incurred depending on the percentage of steel and aluminum content in each part.
- US imports from Mexico in 2024: 11,959 million dollars in aluminum auto parts and 618 million dollars in steel auto parts.
- These imports represent 14% of total Mexican auto part exports to the US, valued at 12,577 million dollars. With a 50% tariff, the potential impact could reach up to 6,289 million dollars.
Impact on Mexican Manufacturers and Supply Chains
The increased tariffs cause a considerable rise in the cost of steel and aluminum materials, directly affecting auto part prices and delivery times in the US. Mexican manufacturers using steel and aluminum as essential inputs for producing components like engines, chassis structures, brake systems, wiring harnesses, and safety modules will also feel the impact.
Moreover, the supply chains within the North American region, operating under “just-in-time” production schemes, will be severely compromised. The inability to meet established delivery times for affected parts will disrupt the entire automotive industry’s operations, jeopardizing vehicle development and impacting exports.
Key Questions and Answers
- What is the estimated impact of the tariff on the US auto parts industry? The National Association of Auto Parts Manufacturers (INA) estimates a 6,289 million dollar impact on the US auto parts and components industry.
- What percentage of global steel and aluminum auto part imports does Mexico represent for the US? Mexico accounts for 38.99% of the US’s global steel and aluminum auto part imports.
- How will the tariff affect Mexican manufacturers and supply chains? The increased tariffs will cause a rise in material costs, affecting part prices and delivery times. Mexican manufacturers using steel and aluminum will also feel the impact, along with disruptions in North American supply chains operating under “just-in-time” production schemes.
