Chinese EV Issue Part of U.S. Trade Talks, Mexico Foreign Secretary Says

The influx of Chinese electric vehicles into the North American market is a significant topic in trade discussions between Mexico and the United States, according to Mexico's Secretary of Foreign Affairs, Roberto Velasco Alvarez. Speaking in Ottawa, Alvarez confirmed that this issue is part of the broader USMCA (United States-Mexico-Canada Agreement) talks.

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Of course, this is part of the USMCA talks, and we continue to look for ways as well to lower the tariffs that the United States has implemented (on Mexico)

Alvarez, who was in Ottawa for a bilateral meeting with Canadian Foreign Affairs Minister Anita Anand, indicated that Mexico is also seeking to reduce U.S. tariffs imposed on Mexican goods. He was asked whether the presence of Chinese EVs sold in Mexico posed an obstacle to the extension of the trade agreement, known as CUSMA in Canada and T-MEC in Mexico. This agreement governs most free trade on the continent.

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The key really is in establishing those lines. We are cognizant that the trading relationship across North America is one of the most integrated in the world

While the U.S. Trade Representative's office has stated it is not renewing CUSMA in its current form, the trade deal remains in effect and will undergo annual reviews. The U.S. has expressed concerns about Chinese-made electric vehicles entering the North American market. Currently, Chinese EVs represent approximately 20% of Mexico's automotive market. Canada has agreed to permit up to 49,000 Chinese electric vehicles annually at a favorable tariff rate.

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We don’t have a large manufacture of Chinese vehicles in Mexico right now. I don’t think there’s more than one Chinese manufacturer in Mexico. At this point, we import vehicles from China for mainly the lowest cost vehicle sector of our market

Alvarez clarified that Mexico's imports of Chinese EVs primarily serve the lower-cost segment of its market, noting that there is currently only one major Chinese vehicle manufacturer operating in Mexico. He also addressed questions about Mexico potentially pursuing a bilateral agreement with the U.S. instead of the trilateral USMCA, reaffirming the importance of the existing trilateral architecture.

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The USMCA is a trilateral agreement. And of course, we, the three countries, agree that architecture should c