Record-Breaking Market Share and Impact of Tariffs
In the first half of 2025, Mexico achieved a record-breaking market share of 39.4% in total U.S. automotive imports, according to data from the Department of Commerce. Since 2021, Mexico has been increasing its market share, particularly in the first half of each year.
Mexican exports reached $85,746 million, encompassing automobiles, trucks, auto parts, buses, and specialty vehicles. However, there was a 5.5% interannual decline in automotive shipments from Mexico to the U.S. during the first half of the current year.
Mexico’s growing market participation from January to June 2025 was due to a greater interannual decline in U.S. imports from the entire world in this sector, which fell by 8.2% to $217,820 million.
Background on Tariffs and Mexico’s Competitive Advantage
On March 26, 2025, President Donald Trump announced a 25% tariff on U.S. imports of automobiles and certain auto parts under Section 232 of the Trade Expansion Act of 1962.
The tariffs took effect for vehicles on April 3 and for auto parts on May 3, with partial exceptions for products meeting certain T-MEC standards.
Over the past decade, Mexico’s participation in total automotive imports has risen from 30.5% in the first half of 2015 to 39.4% in the first half of 2025, with a nearly constant upward trend.
Mexico excels in producing auto parts such as engines, harnesses, seatbelts, and safety airbags, as well as automobiles and commercial transportation vehicles.
Detailed Export Performance
In more detail, Mexican auto exports to the U.S. fell at an interannual rate of 3.0% in the first half of the current year, reaching $22,125 million. Meanwhile, auto parts sales to the same destination were $40,723 million, a decrease of 3.8% compared to the same period in 2024.
Exports of trucks, buses, and specialty vehicles experienced a 10.5% decline, reaching $22,899 million.
Global Vehicle Production and Market Trends
According to S&P’s updated global vehicle production report for July, global light vehicle production increased slightly in the second quarter of 2025 compared to the previous year.
In North America, annualized retail sales remained above 15 million units. According to Visteon, this was due to OEM promotional pricing campaigns and consumer resilience, while production levels continued to decline interannually.
Following Mexico, other major automotive exporters to the U.S. market experienced interannual declines in the first half of 2025: Japan ($27,162 million, -2.0%), Canada ($27,048 million, -8.4%), South Korea ($22,363 million, -14.3%), and Germany ($15,314 million, -13.6%).
Production levels in Europe decreased due to economic difficulties. In China, production increased significantly by a single-digit percentage, while domestic OEMs continued to gain market share compared to the previous year. Looking ahead, S&P’s latest forecast assumes that global production will increase slightly throughout 2025 compared to the previous year.
Challenges and Uncertainties
Visteon considers that the automotive industry continues to face constant risks related to tariffs, vehicle affordability, economic uncertainty, potential geopolitical challenges, and shifts in customer market share.
The impact of recently implemented tariffs on the automotive industry remains uncertain, with potential increases in production costs and future vehicle volume.
Key Questions and Answers
- What is Mexico’s current market share in U.S. automotive imports? Mexico holds a record-breaking 39.4% market share in the first half of 2025.
- How have tariffs affected Mexican automotive exports to the U.S.? Despite a 5.5% interannual decline, Mexico’s exports reached $85,746 million in the first half of 2025.
- What are Mexico’s competitive advantages in the automotive sector? Mexico excels in producing auto parts and vehicles, making it a key player in the global automotive industry.
- How have global vehicle production and sales performed in 2025? Global light vehicle production increased slightly in Q2 2025, while North American retail sales remained above 15 million units.
- What challenges does the automotive industry face? The industry faces constant risks related to tariffs, vehicle affordability, economic uncertainty, geopolitical challenges, and shifting customer market share.
