LATIN AMERICA ADVISOR

LATIN AMERICA ADVISOR

A daily publication Of the dialogue

August 15, 2024

Will Nearshoring to Mexico Survive the U.S. Election?

Tesla CEO Elon Musk said last month that the company will hold off on investing in its Mexico factory before the U.S. presidential election. // File Photo: Daniel Oberhaus (2018) via Creative Commons.

Q

A

Tara Hariharan, managing director of global macro research at NWI Management: “Thanks to extensive supply chain integration with the United States, competitive labor costs and USMCA trade deal perks, Mexico last year overtook China as the largest source of U.S. imports and attracted an 18-year-high $36 billion of foreign direct investment. GM, Kia and BMW have made electric vehicle (EV) investments in Mexico, and the U.S.-led Western Hemisphere Semiconductor Initiative will promote chip assembly and packaging in the country. However, China—notably EV maker BYD—also targets Mexico as a trans-shipment hub to circumvent U.S. tariffs. Tesla’s hesitation regarding a Mexico plant thus anticipates action to prevent Chinese overcapacity flooding the United States through Mexico. Trump proposes tariffs of 10 percent on all U.S. imports, 60 percent on Chinese goods and…”

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The Inter-American Dialogue publishes the Latin America Advisor every business day for a distinguished membership of informed corporate leaders, scholars, and government officials invested in Latin America’s development and future. The Advisor‘s highly regarded Q&A section covers questions submitted by subscribers themselves. Commentators regularly include heads of state, business leaders, diplomats, economists, analysts, and thought leaders from around the world. Many of the world’s largest and fastest-growing companies subscribe to the Advisor. To subscribe, click here. For terms and conditions, click here. For more information, contact Gene Kuleta, editor of the Advisor, at gkuleta@thedialogue.org.

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Gene Kuleta
Editor
P. 202.463.2920
E. gkuleta@thedialogue.org

Carl David
Goette-Luciak
Reporter

Nili Blanck
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Diego Arria
Director,
Columbus Group

Merike Blofield
Professor of Political Science,
University of Hamburg

Devry Boughner Vorwerk
CEO,
DevryBV Sustainable Strategies

Joyce Chang
Global Head of Research,
J.P. Morgan

Marlene Fernández
Corporate Vice President for Gov’t Relations,
Arcos Dorados (McDonald’s)

Peter Hakim
President Emeritus,
Inter-American Dialogue

Donna Hrinak
Director,
Adtalem Global Education

Jon E. Huenemann
Council Member,
GLG Inc.

James R. Jones
Chairman,
Monarch Global Strategies

Craig Kelly
Senior Director,
Int’l Gov’t Relations,
Exxon Mobil

Barbara Kotschwar
Professor of Political Economy,
Georgetown University

John Maisto
Director,
US Education Finance Group

Nicolas Mariscal
Chairman,
Grupo Marhnos

Thomas F. McLarty III
Chairman,
McLarty Associates

Beatrice Rangel
Director,
AMLA Consulting

Ernesto Revilla
Head of Latin American Economics, Citi

Gustavo Roosen
President,
IESA

Andrés Rozental
President, Rozental &
Asociados

Shelly Shetty
Managing Director,
Sovereigns, Fitch

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