Mexico warns tariffs could cost 400,000 US jobs, threatens retaliation

STORY: Mexican President Claudia Sheinbaum said on Wednesday Mexico would retaliate if U.S. President-elect Donald Trump followed through with his proposed 25% across-the-board tariff.

“In case there are tariffs – Mexico would also raise tariffs, so it is a technical move that would also represent benefits for Mexico in the event of a situation like this.”

Trump had said the tariffs would remain in effect until the flow of drugs – particularly fentanyl – and migrants into the U.S. was controlled.

Mexico has warned the tariff could kill 400,000 U.S. jobs and drive up prices for American consumers.

Trump’s proposed tariff could violate the terms of the U.S.-Mexico-Canada Agreement on trade, which the countries signed in 2020 when Trump was president.

That deal continued the largely duty-free trade between the three countries.

Sheinbaum said she was confident the agreement would stand.

Mexican Economy Minister Marcelo Ebrard, speaking alongside Sheinbaum, said the tariff hike would deliver a hard blow to the automotive sector’s top cross-border exporters, including Ford, General Motors and Stellantis.

Ebrard noted that nearly 90% of pickup trucks sold in the U.S. are made in Mexico and would see a price increase.

These vehicles are popular in rural areas that overwhelmingly voted for Trump.

Sheinbaum and Trump spoke by phone later on Wednesday, with the two discussing topics at the top of Trump’s agenda.

In a post on Truth Social, Trump said Sheinbaum “agreed to stop migration through Mexico, and into the United States, effectively closing our Southern Border.”

He described the conversation as “very productive.”

Sheinbaum later responded on X that on the call she had laid out Mexico’s migration strategy, which “attended to” migrants before they arrived at the U.S.-Mexico border.

She added quote,”Mexico’s stance is not to close borders, but to build bridges between governments and their peoples.”