On Wednesday, Mexico took another step toward renewing its commercial relations with the US and Canada. With 114 votes in favor, the Mexican Senate approved USMCA and sent it back to President López Obrador for ratification. According to the Ministry of Economy, USMCA will bring certainty for investors to continue supporting trade as a motor for growth and development. CANACINTRA added that this will boost the reactivation of investment projects that were put on hold.
But the devil is in the details and Mexico’s transportation sector is not particularly happy with USMCA’s terms. Just like in 1994, Mexico’s transportation companies will be at a disadvantage against their US counterparts because no new permits to do long-haul journeys within US territory will be awarded and those in existence could be cancelled. According to Enrique González, President of CANACAR, 3,800 Mexican transportation companies operating 400,000 vehicles used in short distance transport at the US-Mexico border will be impacted.
In local news, San Luis Potosi expects a 9.2 percent increase in its exports thanks to the recently inauguration of BMW assembly plant in the state. Additionally, Bosch and Cummins are supporting the adoption of Industry 4.0 practices and Mexican heavy-vehicle retail sales increased in May. Mexican supplier Metalsa won a tender to work in the chassis of the electric version of the Ford F-150 pickup, while Grupo Alfa, Nemak’s parent company, keeps negative expectations for FY19.
The road is clear. Go ahead!
Closer to a New Trade Environment
On Wednesday, the Mexican Senate approved USMCA and sent it back to President López Obrador for ratification. According to Minister of Economy Graciela Márquez, this sends a message of certainty to investors, consumers and producers to bet on the Mexican economy.
According to CANACINTRA’s Queretaro chapter, USMCA’s ratification offers certainty to investors and boost the reactivation of investment projects currently on stand-by.
According to CANACAR, Mexico’s transportation sector is at a disadvantage under USMCA regulations. No new permits for Mexican transportation companies to offer long-haul services beyond the border will be awarded and those in existence may be cancelled.
Mexico’s Automotive Drive
Uncertainty Challenges and New Technologies