Commerce with Mexico is enormously necessary to the US. In 2024, the U.S. imported roughly $506 billion in items from Mexico. That is roughly 15% of all imports by greenback worth, making Mexico the U.S.’s largest import trading partner and ousting Canada and China.

United States-Mexico-Canada Settlement (USCMA)

America, Mexico, and Canada have intently built-in economies because of the United States-Mexico-Canada Agreement (USCMA), which changed NAFTA in 2020. USCMA up to date the older free commerce settlement and added new guidelines for digital commerce, labor protections, and environmental requirements.

USCMA stipulates that 75% of auto parts have to be made in North America to qualify for tariff-free standing, a rule meant to extend regional manufacturing. It additionally requires that at the least 40% to 45% of auto manufacturing in North America be achieved by staff incomes at the least $16 an hour. The purpose is to shut the hole between labor costs within the U.S. and Mexico.

This rule offers stability for companies and decrease prices for customers. It additionally means higher wages and labor rights for Mexican staff.

Imports From Mexico

America imports numerous items from Mexico. The highest 5 import classes in 2023 had been:

• Vehicles: $44.9 billion
• Motor vehicles; components and equipment: $35.2 billion
• Supply vans: $26.3 billion
• Computer systems: $25.6 billion
• Crude petroleum: $20.4 billion

Cars and auto components are essentially the most vital imports. A number of massive U.S. auto firms, together with Ford and GM, have manufacturing vegetation in Mexico, making vehicles, engines, and different merchandise which might be then returned stateside on the market.

Different necessary imports embrace insulated wire, video shows, medical tools, air conditioners, and beer.

U.S. Exports

Whereas the U.S. imports a big quantity from Mexico, its exports are additionally sizeable, totalling $334 billion in 2024.

The most important exports from the US to Mexico in 2023 included:

• Refined petroleum: $29.7 billion
• Motor autos; components and equipment: $17.7 billion
• Petroleum gas: $8.87 billion
• Combustion engines: $5.84 billion
• Corn: $5.27 billion

What About China?

China was once the US’ largest import accomplice. Nonetheless, within the late 2010s, throughout the tariff wars initiated by the primary Trump administration, companies confronted many points, corresponding to rising prices and political rigidity.

Many firms began to nearshore manufacturing, shifting manufacturing nearer to the US, and Mexico was a transparent alternative. This resulted in Mexico surpassing China because the U.S.’s largest import accomplice in 2023. The U.S. imported $439 billion price of products from China in 2024.

The Backside Line

Commerce between the U.S. and Mexico has elevated, because of initiatives like USCMA and a partial shift away from China.

The proximity, decrease labor prices, and favorable commerce phrases have made Mexico an necessary participant within the U.S. provide chain. On the identical time, U.S. exports to Mexico are robust, making the connection helpful to each nations.