Mexico welcomes US decision to waive tariffs on auto parts under USMCA

Mexico City, May 3 (IANS) Mexico has welcomed a US decision to exempt Mexican auto parts from tariffs under the United States-Mexico-Canada Agreement (USMCA), calling it a major breakthrough for the country's manufacturing sector.

Secretary of Economy Marcelo Ebrard said on Friday that the exemption was confirmed in new US customs guidance published on Thursday, reaffirming that Mexican auto parts will be treated as if they originated in the US and will enter duty-free, Xinhua news agency reported.

"This is a significant step forward," Ebrard said during the government's daily press briefing.

"Mexican auto parts, and those headed to Canada as well, will continue receiving the preferential treatment guaranteed by our treaty."

Ebrard, who has led negotiations with US officials, said the development reflects progress in avoiding new trade barriers and protecting cross-border supply chains.

He added that President Claudia Sheinbaum has made the issue a top priority.

"You can't slap a 25 per cent tariff on auto parts, plus another 25 per cent on steel, aluminum, and final products -- that would wipe out entire companies," he said, referring to ongoing talks with US Commerce Secretary Howard Lutnick.

The tariff suspension follows the sixth phone call between Sheinbaum and US President Donald Trump, during which both agreed to keep working toward solutions on trade and other bilateral issues.

At a press briefing on Friday, Sheinbaum said the decision was "good news".

"There's a preferential treatment for everything that is produced within the trade agreement, and in particular for auto parts, which have zero tariffs," she said, noting that she and Trump spoke by phone on Thursday.

"We continue working together, and if you've noticed, we keep getting better conditions compared to what the situation was previously."

Mexico continues negotiations with the US to prevent the implementation of Trump's broader executive orders targeting key industrial sectors.

--IANS

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