(Bloomberg) -- Donald Trump’s plan to impose large tariffs on Chinese exports could endanger US companies operating in Mexico, Economy Minister Marcelo Ebrard warned as he braces for potentially difficult trade negotiations with the incoming US administration.
Most Mexican imports from China are made by about 50 companies and the large majority of them are US companies, Ebrard told reporters in Mexico City on Thursday.
“Putting a tariff on these imports will only put these companies in danger, starting with the automotive industry,” he said after a meeting with representatives of Mexico’s retail association. “We have already faced circumstances regarding tariffs and we have come out on top because tariffs have a very big impact on the US economy.”
Trump, who said “tariff” is the most beautiful word in the dictionary, has promised 60% levies on goods imported from China, and 20% on the rest of the world. The president-elect pledge would hit Mexico particularly hard, since it’s the US’s No. 1 trading partner. Also, during his campaign, Trump said automakers building plants in Mexico are a “serious threat” to the US.
Ebrard said that it is not feasible to move US automobile plants operating in Mexico to the US, since companies such as Ford Motor Co. have their main production centers in the Latin American country. “The fact that the US automotive industry is in Mexico is one of the reasons why it has survived this century,” he added.
Trade Deal
Talks between the US president-elect and Mexican President Claudia Sheinbaum have already started with a “cordial” call this morning, Sheinbaum said in a post on X. She said they spoke about the “good relationship” between the two countries.
One of the main challenges for the two and the US-Mexico commercial relationship will be the revision of the US-Mexico-Canada trade agreement, scheduled for 2026.
Ebrard said the review of the free trade agreement, promoted by Trump and known as USMCA, will be “effective and good.”
“You are talking to the US president who led that negotiation, why would he be against something that he promoted and that also has good results?”
The minister highlighted that from 2023 to 2024, thanks to the deal, Mexico’s exports to the US grew 6.5%, while Mexican imports from the US grew 4.7%.
“I’m optimistic, I’m not saying it’s going to be easy, but the relationship with President Trump is going to be very good,” he said.
(Updates with context and Ebrard’s comments from fourth paragraph.)
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