In recent weeks, businesses located along the United States-Mexico border have experienced significant uncertainty due to President Donald Trump’s tariff policies. Over a period of six weeks, companies operating in this region have dealt with fluctuating tariff implementations. In early March, for a brief three-day period, goods entering the U.S. from Mexico faced a sudden 25% tariff. This situation left manufacturers, distributors, and customs agents in disarray as they sought clarity in a desert industrial park near El Paso, Texas. Warehouses across the border in Juárez were filled with inventory that could not be moved.
President Trump later reversed his decision for most shipments but imposed a 25% tariff on metals and cars. Businesses along the border were temporarily relieved when Mexico was excluded from the list of countries facing “reciprocal” tariffs. However, this did not fully dispel the existing apprehension in the border region. Octavio Saavedra, President of EP Logistics, voiced concerns despite avoiding immediate disruption. One pressing issue is the 25% tariff on foreign steel and aluminum, which took effect the previous month. A customer of EP Logistics, a Mexican steel column manufacturer, is currently holding stock in Mexico to avoid the levy.
Another concern pertains to imports from Mexico taxed at 25%, exacerbated by Trump’s shifting stance on the United States-Mexico-Canada Agreement (USMCA). Although the agreement allows duty-free trade for North American products, all other goods remain subject to the hefty tariff. Saavedra emphasized the need for his company to ensure compliance with USMCA requirements.
The wider Texas-New Mexico industrial region is apprehensive about further changes in Trump’s policies. Daniel Manzanares, director of the Santa Teresa International Export and Import Livestock Crossing in New Mexico, expressed unease over potential unpredictability. When tariffs were imposed on Mexican goods in March, it led to a temporary sharp decrease in crossings.
On a particularly turbulent Wednesday, global tariffs and subsequent retaliations by China caused concerns over additional tariffs affecting Mexico and Canada. Jerry Pacheco, President of the Border Industrial Association, processed this information while observing potential economic impacts on regional businesses. However, the White House later confirmed that tariffs on Mexico and Canada would remain unchanged. Pacheco commented on the unstable environment, noting its adverse effects on industrial operations.
In a region where trade with Mexico contributes tens of billions of dollars annually, stakeholders are closely monitoring Trump’s policy shifts. The Santa Teresa industrial park in New Mexico is home to numerous businesses reliant on cross-border trade, with American companies comprising about two-thirds of them. Pacheco highlighted the intertwined economic relationship with Mexico and expressed concerns over vacant facilities caused by tariff uncertainties.
Jon Barela, CEO of the Borderplex Alliance, observed a halt in investments by companies, particularly in the medical devices and car production sectors. These entities are waiting to see how the tariff situation evolves. Lane Gaddy, CEO of W. Silver Recycling, experienced firsthand the challenges brought on by the March tariffs. He described the unsustainability of broad tariffs and noted that the situation had somewhat stabilized. Gaddy was not surprised by the exemption retention under USMCA, commenting that imposing tariffs could significantly disrupt the U.S. economy.
