Reports of progress in trade talks between the United States and Mexico this week should come as welcome news to millions of American autoworkers who have been holding their breath since negotiations with Canada collapsed last month. On Monday, President Donald Trump said an agreement with Mexico was close and raised the prospect of eliminating the 25% tariffs now affecting some Mexican goods — a potentially significant development for North American manufacturers.
They have good reason to worry. The U.S. and Canadian auto industries aren’t simply trading partners; they are parts of the same manufacturing system. The U.S. exports roughly $30 billion in auto parts to Canada each year, running a $10 billion surplus, and more than half the value of a Canadian-built vehicle originates in the U.S. In Michigan and Ontario, parts routinely cross the border several times before a finished vehicle rolls off the assembly line.
