Mexican agricultural and auto-parts producers called for "dialogue" on Sunday to avoid a trade war triggered by US President Donald Trump’s decision to impose a 25 percent tariff on imports from Mexico and Canada.

Sheinbaum Awaits Response from Trump

Mexican President Claudia Sheinbaum stated that she is waiting for a response from Trump regarding her proposal for talks. She suggested forming a working group to address migration and drug trafficking. Sheinbaum plans to announce her next steps by Monday.

Industries Brace for Impact

The agriculture and auto-parts industries are expected to bear the brunt of Trump’s tariffs. He claims the tariffs are designed to pressure Mexico and Canada to take stronger action on migration and drug trafficking.

Counter-Tariffs from Mexico and Canada

In response, both Mexico and Canada have announced their own counter-tariffs. Furthermore, the US has targeted China with new 10 percent tariffs, in addition to those already imposed.

Job Loss and Economic Risks

The tariffs, which are set to take effect on Tuesday, will harm North America’s competitiveness. According to Mexico’s National Auto Parts Industry (INA) and National Agricultural Council (CNA), millions of jobs are at risk.

The Automotive Industry’s Concerns

The Mexican automotive industry, which is part of the United States-Mexico-Canada Agreement (USMCA), exported $36 billion in goods to the US in 2023. This represents 5 percent of Mexico’s GDP. The INA also emphasized that the auto sector and related industries support 11 million jobs across the three countries.

Increased Costs and Falling Sales

Moreover, the INA warned that the tariffs could increase the cost of an average car by $3,000. This, in turn, could lead to a reduction of one million car sales this year. Many car parts cross borders multiple times during assembly, further adding to the cost.

Mexico’s Agricultural Exports at Risk

Similarly, the CNA pointed out that Mexico supplies 50 percent of the avocados, tomatoes, chili peppers, and berries consumed in the US. Additionally, the country exports more than $1.5 billion worth of beef and pork to the US.

Call for Unity and Cooperation

In light of US pressure, the CNA called for “unity and dialogue.” The group emphasized that the agricultural sector is putting past differences with Sheinbaum aside, in the hope of resolving the issue.