Overview
- The third bilateral round in Mexico City ended in late July with officials calling talks constructive but leaving the automotive rules of origin dispute unresolved.
- Washington is pushing for higher regional content and new U.S.‑specific requirements for vehicles while Mexico says it will accept up to 90% regional value only if rules recognize Mexican as well as U.S. content.
- A Section 301 investigation on Mexico’s alleged 'excess capacity' is set to conclude in the first week of August and could prompt new duties that would erase tariff‑free treatment for a large share of exports.
- Both sides agreed to a fourth bilateral round in Washington in early September to press outstanding issues while some complex items may be deferred into 2027 and could require U.S. Congressional action.
- The outcome matters to hundreds of thousands of firms and millions of jobs across North America because changes to origin rules or new tariffs would reshape supply chains, investment plans and costs for mainly small exporters.