Mexican standoff looms between Trump and carmakers south of border
▻https://www.ft.com/content/751c4628-d1f5-11e6-b06b-680c49b4b4c0
Mexico’s motor industry has seen extraordinary growth in the 22 years since the North American Free Trade Agreement opened up the US market.
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Production more than tripled to 3.4m vehicles in 2015, and 82 per cent of the country’s 2.7m exports that year went to the US or Canada.
But Ford’s announcement on Tuesday that it was abandoning plans for a new Mexican car plant highlights the serious threat that incoming US president Donald Trump poses to the industry.
The president-elect has publicly berated US companies that move work across the southern border, including General Motors just this week, and threatened to tear up Nafta.
Sergio Marchionne, chief executive of Fiat Chrysler, has already described Mr Trump’s election as a “game changer” for the car industry.
Since 1994, low labour costs, unfettered access to the US market and free-trade deals covering another 44 countries have propelled Mexico to become the world’s seventh largest car manufacturer and fourth-largest exporter. Its plants and supply chain support more than 750,000 jobs.