Mexico has seen gains in shipments to the U.S. in products where competing Chinese goods were hit with tariffs, everything from poster board to air conditioner parts.
Cars leave the General Motors assembly plant in Villa de Reyes, Mexico, in January 2017. Aveo and Trax vehicles have been produced at the factory since 2008.
Fuling isn’t alone. Mexico has seen gains in shipments to the U.S. in categories in which competing Chinese goods were hit with tariffs, including poster board and air conditioner parts. In all, U.S. imports of goods from Mexico surged 10% to almost $350 billion last year, the fastest growth in seven years. That helped widen the U.S. trade deficit with Mexico by 15% to more than $80 billion, while the growth in shipments from China slowed by about a third.
Given Trump’s early attacks on Mexico for taking U.S. jobs, it’s an ironic turn to observers such as factory consultant Alan Russell, who has never seen such interest by U.S. companies in opening facilities south of the border in his 35 years in the industry For example, Taskmaster Components has for almost 20 years imported large wheels and tires from China, and assembled them for companies making trailers and recreational vehicles. But tariffs on many of those products pushed the Mount Pleasant, Texas, company to go hunting for new sourcing. That list now includes Mexico, where it wants to invest in a factory.
The trade war also made the U.S. more reliant on produce from Mexico, already the biggest source of vegetables such as cauliflower, carrots and onions. In one stark example, imports of peeled garlic cloves from China sank by almost a quarter after receiving tariffs, while Mexican exports rose 54%.
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