U.S. Trade Representative Jamieson Greer has signaled to Mexican industry leaders that President Donald Trump's tariffs on steel and autos are here to stay, a hardline stance that sets a contentious tone for the upcoming six-year review of the U.S.-Mexico-Canada Agreement (USMCA).
U.S. Trade Representative Jamieson Greer has signaled to Mexican industry leaders that President Donald Trump's tariffs on steel and autos are here to stay, a hardline stance that sets a contentious tone for the upcoming six-year review of the U.S.-Mexico-Canada Agreement (USMCA).
U.S. Trade Representative Jamieson Greer told Mexico's auto and steel industries they should not expect the renegotiation of the U.S.-Mexico-Canada Agreement to remove President Donald Trump's tariffs on their sectors, four industry sources familiar with the discussions said. The message, delivered during meetings in Mexico City, suggests the 25% duty on autos and 50% tariff on steel will become permanent features of North American trade, dismantling over three decades of tariff-free commerce.
"Greer said tariffs are here to stay. President Trump likes them. We will never go back to a zero-tariff world," said one of the four sources, who attended a meeting with the U.S. official. The comment marks a significant clarification of the U.S. position ahead of the USMCA review scheduled to begin July 1.
The tariffs have hit Mexico's export-heavy industries hard. The country's automotive sector, which sends over 50% of its exports to the U.S., saw vehicle exports fall nearly 3% in 2025 after the 25% duty was imposed in March of that year. The downturn contributed to a loss of approximately 60,000 auto industry jobs, according to Mexican government data. Steel producers face a similar challenge with a 50% U.S. duty on commodity steel and aluminum products.
The core issue is a fundamental shift in U.S. trade philosophy under President Trump, who has argued the previous system of "hyperglobalism" hollowed out the American working class. His administration has moved to replace what it sees as a defunct system with one prioritizing balance, sovereignty, and domestic industrial strength. This strategy includes using tariffs not just as a negotiating tactic, but as a durable instrument of a new American industrial policy.
The upcoming USMCA review is a critical juncture for all three member nations. Mexican President Claudia Sheinbaum had expressed hope for a preliminary agreement to ease the duties on steel and autos before the formal review process. However, Greer's comments indicate that Washington's focus is on tightening, not loosening, trade rules. U.S. negotiators have proposed changing rules of origin to require 100% of key components like engines and software be sourced from North America, a significant increase from the current 75% threshold.
This stance complicates the landscape for both Mexico and Canada. Canadian Prime Minister Mark Carney has described the U.S. trade offensive as a "real threat," forcing Canada to seek new trade deals and investments to reduce its economic dependence on the United States. In a notable pivot, Canada struck a deal to allow a limited number of Chinese electric vehicles into its market at a 6 percent tariff rate, a stark contrast to the 100 percent tariff the U.S. imposed on Chinese EVs.
The Trump administration's approach is part of a broader goal to establish a new global trade order. As outlined by administration officials, this new system would be built on the principle of balanced trade, where countries agree to maintain an overall balance in their international commerce over a short period, such as three years. Countries running persistent surpluses would face higher tariffs from other members until they achieve balance.
This represents a direct challenge to the export-led models of countries like China and, historically, Japan and Germany. The administration argues that for decades, the U.S. acted as the "consumer of last resort," absorbing excess capacity from countries that used industrial policy, subsidies, and currency manipulation to gain an advantage. The tariffs are a defensive measure against these practices, which the U.S. contends have transferred trillions of dollars of wealth overseas and suppressed American economic growth.
While Mexico and Canada have largely been protected from the steepest tariffs thanks to the USMCA, the permanence of duties on key sectors signals that no trading partner is exempt from the new U.S. doctrine. As formal bilateral negotiations are set to launch the week of May 25, industries across North America are bracing for a future where tariffs are no longer a temporary threat, but a long-term reality.
This article is for informational purposes only and does not constitute investment advice.
