Business · Trade · 2 hrs ago
Mexico seeks lower US tariffs on cars in trade talks
Mexico is seeking a reduction in US tariffs on cars made in Mexico as part of a proposed partial trade agreement.
The United States currently applies a 25% tariff to Mexican cars under a law that allows tariffs on national security grounds, with an exemption for the US-made content of vehicles.
Mexico wants the tariff lowered to below 15%, which it says could bring the effective rate to between 5% and 10%.
Former Economy Secretary Ildefonso Guajardo said counting content from all of North America in the exemption could bring the effective rate to 4.5%.
US officials are reluctant to give up the option of future tariffs, making the negotiations harder.
US imports of cars from Mexico fell 17.1% year over year from January to August 2026, to $24.863 billion.
Mexico's economy secretary expects a reduction in the coming weeks or months, but no agreement has been announced.
Mexico is seeking a reduction in US tariffs on cars imported from Mexico as part of a partial trade agreement.
The current 25% tariff applies only to the non-US content of the vehicles, and Mexico wants the rate lowered to less than 15%.
Trade specialist Kenneth Smith said a clause preserving the US ability to impose future tariffs has made negotiations more difficult.
Former Economy Secretary Ildefonso Guajardo said a broader discount for North American content could bring the effective tariff to 4.5%.
US imports of cars from Mexico fell 17.1% year on year from January to August 2026, Smith said.
- Who
- Mexico and the United States are negotiating; Kenneth Smith and Ildefonso Guajardo discussed the proposed tariff reduction.
- What
- Mexico is seeking lower US tariffs on cars imported from Mexico as part of a partial trade agreement.
- When
- The report was published on October 29, 2026. Marcelo Ebrard expressed confidence in a reduction on October 16.
- Where
- The negotiations concern US tariffs on cars imported from Mexico. Smith spoke at the 32nd Mexican Foreign Trade Congress in Monterrey, Mexico.
- Why
- Mexico wants to reduce the tariff burden on its car exports. Smith said the US reservation of the right to impose future tariffs has complicated negotiations.
This story does not have two clearly opposing sides.
The United States began charging a 15% tariff on car imports from the European Union.
The United States began charging a 15% tariff on car imports from Japan.
The United States began charging a 15% tariff on car imports from South Korea.
Economy Secretary Marcelo Ebrard said he was confident the United States would reduce tariffs on cars and steel from Mexico in the coming weeks or months.
Kenneth Smith said a clause preserving the possibility of future US tariffs had made negotiations over a partial trade agreement more difficult.
- Current US tariff on Mexican cars
- 25% on non-US vehicle content
- Mexico's target
- Less than 15% tariff; effective rate of 5% to 10% after deductions
- Guajardo's proposal
- 4.5% effective tariff if the discount also covered all North American content
- US car imports from Mexico
- Down 17.1% year on year to $24.863 billion, January–August 2026
- Article publication
- October 29, 2026
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in the coming weeks or months