Introduction

Mexico’s tariff increases that came into effect on January 1, 2026 most heavily affect manufacturing industries exposed to import competition from countries without free trade agreements (FTAs) with Mexico, particularly China and several Asian economies.¹ The measures expanded tariff coverage across more than 1,400 tariff classifications and increased duties across key industrial and consumer sectors. The industries most affected are steel and metals, textiles and apparel, footwear, automotive and auto parts, plastics and chemicals, and consumer manufactured goods.

Contextual background

Before January 2026, Mexico had already begun shifting toward a more protectionist trade policy framework despite remaining deeply integrated into North American supply chains through the United States-Mexico-Canada Agreement (USMCA).²

Concerns over rising imports from non-FTA partners, especially China, increased pressure on domestic industries such as steel, textiles, footwear, and consumer manufacturing. In April 2024, Mexico introduced temporary tariffs across more than 500 tariff lines, with rates ranging from 5% to 50% depending on the sector.² Steel and aluminum products faced tariffs of up to 50%, while textiles, apparel, and footwear products generally faced duties between 15% and 35%. Plastics, chemicals, glass, ceramics, paper products, and industrial intermediates commonly faced tariffs between 10% and 25%, while transport equipment, machinery, electrical products, furniture, and other manufactured consumer goods were subject to tariffs ranging from 15% to 35%.² These tariffs did not apply to products receiving preferential treatment under Mexico’s FTAs, including originating goods traded under the USMCA.³ These earlier measures laid the foundation for the broader January 2026 tariff regime, which expanded industrial protection as part of Mexico’s nearshoring and domestic manufacturing strategy.¹

Mexico also strengthened customs enforcement and import monitoring mechanisms to reduce tariff circumvention practices and tighten oversight of imports entering the country.¹

Industries most affected by the January 2026 tariffs

1. Automotive and auto parts

Automotive manufacturing and auto parts are among the most heavily affected sectors under the new tariff regime. Mexico raised duties on automobiles and selected automotive products to as high as 50%, particularly for imports originating from non-FTA countries such as China and India.¹

Electric vehicles (EVs), which previously faced tariffs of 15%–20%, became subject to tariffs of up to 50% under the January 2026 measures.¹ Mexico’s automotive imports total approximately US$64 billion annually, with China accounting for roughly US$10.7 billion and India US$1.7 billion of automotive exports to Mexico.¹

The measures are intended to encourage manufacturers to localize production within Mexico or within FTA partner countries such as the United States, Japan, and the United Kingdom.

2. Textiles and apparel

Textiles and apparel are among the largest categories affected by the tariff increases. Mexico increased tariffs on all textiles and certain footwear inputs to as high as 35%, which represents Mexico’s maximum bound tariff rate under the World Trade Organization framework.¹

Previously, Mexico had implemented a two-tiered structure that imposed tariffs of around 15% on certain textile inputs and 35% on finished textile goods until April 2026.¹ Under the January 2026 framework, many textile inputs that previously faced low or zero tariffs became subject to duties ranging between 25% and 35%.¹

The government also expanded IMMEX restrictions by adding more products to the exclusion list in August 2025, limiting manufacturers’ ability to import raw materials duty-free.¹ These measures significantly increased costs for manufacturers dependent on imported textile inputs.

3. Footwear and leather products

The footwear sector is heavily affected by the new tariff regime. Mexico increased tariffs on selected footwear products and footwear inputs to rates reaching 35%.¹

The measures target low-cost imports competing directly with domestic footwear manufacturers, particularly producers concentrated in industrial regions such as Guanajuato. By increasing tariffs on imported footwear inputs alongside finished products, the government aims to encourage local sourcing throughout the supply chain.

4. Steel and aluminum

Automotive manufacturing and auto parts are significantly affected because the tariff package expanded duties across transport equipment and industrial inputs sourced from non-FTA countries.¹

Many affected tariff lines now face duties in the 5%–35% range, while selected strategic industrial products face tariffs as high as 50%.¹ The measures apply to products used across automotive manufacturing, machinery, infrastructure, and construction industries.

5. Plastics, toys, furniture, and household appliances

The tariff increases also heavily affect plastics, toys, furniture, household appliances, and other consumer manufactured goods.¹

Many of these products now face duties ranging from 5% to 35% depending on product classification and origin.¹ These measures are intended to encourage foreign manufacturers to relocate production into Mexico rather than export finished products directly into the domestic market.

Conclusion

The industries most affected by Mexico’s January 1, 2026 tariff increases are automotive manufacturing, textiles and apparel, footwear, steel and aluminum, and a broad range of consumer manufactured goods. Tariff rates generally range between 5% and 35%, while strategic sectors such as automobiles and electric vehicles face tariffs of up to 50%.¹ The measures represent a major expansion of Mexico’s industrial protection strategy and reflect broader efforts to strengthen domestic manufacturing capacity, support nearshoring, and reduce dependence on imports from non-FTA economies.