Editor's note: President Trump announced late Friday that he will not be imposing tariffs on Mexico imports (read more details here) next week, tweeting: "The Tariffs scheduled to be implemented by the U.S. on Monday, against Mexico, are hereby indefinitely suspended. Mexico, in turn, has agreed to take strong measures to stem the tide of Migration through Mexico, and to our Southern Border." The below article was published Friday morning, June 7.
High-level meetings between the U.S. and Mexico to head off tariffs on imported Mexican goods, threatened by President Donald Trump to begin Monday, June 10, have been unsuccessful.
If talks on Friday do not change anything, the president is expected to take the required formal steps that pave the way for the tariffs to be enacted. However, it remains possible an agreement could be reached over the weekend to end the dispute.
While the tariffs would start at 5% on June 10, that number could grow to 25% by October if Mexico does not help the U.S. curb migration across the countries’ border, Trump said.
The tariffs could hurt freight transportation companies since Mexico is one of the United States’ biggest trading partners. Supply chains could be adversely affected, especially ones like the automotive industry, which utilizes parts that cross borders often.
How quickly the U.S. Customs and Border Protection could implement the tariffs was still in question. Some of the questions center around how to tax goods manufactured in Mexico with U.S. parts -- and if its software can be updated over the weekend to calculate the proper tariff by Monday.
“It is our responsibility as the most knowledgeable professionals, to express our grave concern, even alarm, that it will be impossible to comply, as the mechanisms for compliance are not available between now and June 10, or even before the increase planned for July 1,” the Pacific Coast Council of Customs Brokers and Freight Forwarders Association wrote in a letter to the Trump administration.
The auto industry imported $59.4 billion in parts from Mexico last year, according to U.S. government trade data. That includes parts used in factories and those sold in auto parts stores and repair shops.
While light truck sales were up in May, heavy-duty truck orders have been sluggish this spring -- mainly because of high demand and limited open building slots.
Border states such as Texas and manufacturing states such as Michigan and Ohio would be the hardest hit by tariffs, according to an analysis by the U.S. Chamber of Commerce.
The Trump administration is pushing Mexico to sign a "safe third country" agreement that would require Central American migrants to seek asylum in Mexico if they pass through it on the way to the U.S.
On June 5 Trump tweeted: “Immigration discussions at the White House with representatives of Mexico have ended for the day. Progress is being made, but not nearly enough! Border arrests for May are at 133,000 because of Mexico & the Democrats in Congress refusing to budge on immigration reform. Further talks with Mexico will resume tomorrow with the understanding that, if no agreement is reached, Tariffs at the 5% level will begin on Monday, with monthly increases as per schedule. The higher the Tariffs go, the higher the number of companies that will move back to the USA!”
However, Sen. Marco Rubio (R-FL) supported Trump and the tariffs, tweeting “What alternative do my GOP colleagues have to get #Mexico to secure its southern border, use the Isthmus of Tehuantepec to screen northbound rail cars & vehicles & act on intel we provide on human traffickers?"
