Mexico has asked to be excluded from a U.S. investigation into structural overcapacity in manufacturing, a process that could lead to additional trade measures.
At a hearing held by the Office of the U.S. Trade Representative, Mexican officials argued that the country’s factories operate at roughly 80% of installed capacity and that investment, production, and expansion decisions are largely made by private companies.
The Section 301 investigation is examining whether governments encourage output beyond market demand through subsidies, preferential financing, state-owned companies, or other forms of intervention.
Washington included Mexico alongside 15 other economies. Factors cited in the case include Mexico’s goods trade surplus with the United States, its role in automotive manufacturing, and the expansion of its steelmaking capacity.
Mexican industry representatives said the two countries operate through integrated production networks. In steel, they noted that Mexico runs a supply deficit and imports part of its requirements from U.S. producers.
Some U.S. manufacturers, however, raised concerns about production shifting to Mexico and the use of lower-cost Asian inputs in goods later sold in the American market.
The outcome will determine whether Washington imposes new tariffs and whether USMCA-compliant products receive different treatment.
Source: Expansión
