Abstract

ALVAREZ MEDINA, María de Lourdes. Impact of the United States-Mexico-Canada Agreement (USMCA) Rules of Origin On the Automotive Sector in Mexico. Norteamérica [online]. 2021, vol.16, n.2, pp.403-430.  Epub Apr 04, 2022. ISSN 2448-7228.  https://doi.org/10.22201/cisan.24487228e.2021.2.489.

This article aims to analyze the impact of the USMCA’S new rules of origin on the automotive sector in Mexico. Specifically, to understand the dynamics of change and protectionism, the author explores possible adjustments in light vehicle production, variations in the imports of regulated auto parts, and changes in labor regulation, and analyzes the regional value content (RVC) reported for each car assembled in Mexico and sold in the U.S. in 2020 and 2021. She uses a trade database to analyze changes in imports of the groups of regulated auto parts to determine growth trends. Companies comply heterogeneously with the new rules of the agreement depending on their product strategies, how far they are from meeting the new RVC threshold, and the tariff levied. Rules of origin affected German and Asian automakers producing in Mexico more than their competitors; however, they underwent fewer adaptive changes.

Keywords : automotive industry; USMCA; industry relocation; rules of origin; protectionism.

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