Why politicians and industry groups are calling Mexico a 'backdoor' for Chinese EV automakers

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The BYD HAN EV is displayed during an exhibition test drive as the Chinese electric-vehicle producer announces its expansion to the Mexican consumer market, in Toluca, Mexico on Nov. 29, 2022.

Politicians and auto industry groups in the U.S. and Canada have upped their criticism of Mexico, expressing concern that the country is becoming a haven for Chinese automakers trying to circumvent North American tariffs on its products.The BYD HAN EV is displayed during an exhibition test drive as the Chinese electric-vehicle producer announces its expansion to the Mexican consumer market, in Toluca, Mexico, on Nov. 29, 2022. Politicians and auto industry groups in the U.S.

The U.S. and Canada penalized Chinese electric vehicles, steel and aluminum this year in a bid to combat Chinese overcapacity and shore up domestic manufacturing. Some have criticized Mexico for not matching the tariffs There was a 60 per cent surge in shipping container exports from China to Mexico in January 2024 from the same time last year, according toWATCH | Canadian premiers Ford, Smith want Mexico out of CUSMA:Alberta Premier Danielle Smith and Ontario Premier Doug Ford have both said Mexico should be cut out of the North American trade agreement and Canada should sign a bilateral deal with the U.S., proposals that would curry favour with U.S. president-elect Donald Trump.In the U.S.

"The threat parts and materials that aren't Mexican, that might come through Mexico, is that they would displace the investments that auto suppliers have made in this continent to manufacture goods and meet the USMCA definition of local content," explained Volpe. "The real concern isn't the scale of FDI in Mexico — it's the rapid growth. While still lower than other countries, Chinese FDI is expanding at an unprecedented rate," Marroquín Bitar later wrote

 

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