The Mexican government has formally requested that the United States implement a complete standstill on new trade tariffs for the duration of the joint review of the USMCA, Mexico’s Minister of Economy, Marcelo Ebrard, announced following the launch of InnovaFest Querétaro.
In addition to advocating for a tariff freeze while USMCA talks proceed, Mexican negotiators are pushing Washington to eliminate or reduce current duties impacting critical manufacturing sectors, specifically automotive exports and steel products.
A Bid for Lower Automotive and Steel Tariffs
Addressing journalists at the event, Ebrard disclosed that Mexico presented an empirical study to US officials to substantiate its demand for tariff relief in the automotive industry. Under current policies implemented by the US administration, vehicles manufactured in Mexico face a 25% tariff rate. By comparison, automotive exports from nations such as Japan, South Korea, Germany, and Morocco are subject to a lower 15% rate.
Ebrard argued that this structure penalizes Mexican manufacturing despite its deep integration with the US supply chain.
“Apply a discount to me, because I buy more parts from the United States than the other countries I just mentioned,” Ebrard stated, confirming recent reports regarding Mexico’s formal trade proposals.
Mexico has raised similar objections regarding steel tariffs. US policy imposes a 50% duty on Mexican steel imports, a measure Ebrard criticized given that Mexico maintains a trade deficit in steel with the United States.
“We have also raised the issue of steel. Mexico has a steel deficit with the United States. So why are you imposing a 50% tariff on me?” Ebrard asked.
High Supply Chain Integration and Political Realities
Trade experts offer contrasting views on Mexico’s strategy. Adrián González, president of Global Alliance Solutions, noted that Mexico’s demand is logically grounded in cross-border supply chain mechanics, particularly within automotive manufacturing.
“Mexico has greater integration with the United States. More American inputs are part of the Mexican product that the United States imports directly. It makes no sense to penalize that American content or put it at a disadvantage against imports from other countries with lower American content,” González stated.
However, González emphasized that achieving tariff modifications will rely on political negotiation rather than formal legal channels.
Conversely, Jorge Molina, an international trade consultant, questioned the timing of Mexico’s study given the hardening stance of the Office of the United States Trade Representative (USTR).
“At a time when USTR is tightening its position, is it going to change its stance with a study? Why was this study not presented earlier?” Molina asked, noting that the core issue will be what concessions Mexico can offer. “The United States is seeking a negotiation, and the question is: what would Mexico be willing to offer in exchange for lowering tariffs?”
Negotiating Strategy, Effective Rates, and Agricultural Flows
The formal joint review of the USMCA officially began on July 1. Ebrard stressed that the Ministry of Economy is pursuing a strategy of constant presence in Washington, sending a delegation weekly to engage directly with decision-makers.
“We are the most persistent, persevering, patient, and insistent delegation,” Ebrard quipped, underscoring the necessity of direct engagement to influence policy.
Despite ongoing trade friction, Ebrard highlighted that Mexico maintains a favorable trade position globally, with an effective tariff rate of 3.4% on its exports to the US, substantially lower than that paid by other major trading partners. Studies by the Mexican Institute for Competitiveness (IMCO) covering January 2024 through April 2025 reinforce that Mexico has strengthened its role as a strategic US supplier, with USMCA remaining the central mechanism for regional competitiveness.
Ebrard also noted recent bilateral talks aimed at unblocking full Mexican avocado exports to the US, following a diplomatic model that previously allowed the resumption of live cattle shipments.
Domestic Strategy: Innovation and Industrial Modernization
Alongside trade diplomacy, Ebrard framed domestic innovation as essential to maintaining long-term economic competitiveness against automation and artificial intelligence.
Highlighting national performance, Ebrard revealed that Mexico recorded roughly 20,600 patent applications last year, compared to 1.5 million in China, with only about 600 submitted by Mexican companies, students, or institutions by late 2024.
To address this gap, Mexico is hosting InnovaFest on Aug. 21. Financed through a private trust established by Scotiabank alongside participating corporate sponsors, the initiative will roll out across five regional hubs: Monterrey, Queretaro, Guadalajara, Merida, and Morelos.
The Queretaro event will bring together 170 investment funds, 100 companies and universities, and 6,500 submitted projects, expected to yield 670 prototypes. Features include a MX$1 million (US$58,783) grand prize and free artificial intelligence workshops conducted by tech firms Nvidia, Saptiva, and Meta.