The increasingly contentious battle between the Trump Administration and Mexico could lead to some significant collateral damage, notably including both carmakers and car buyers.
With the Mexican government rejecting a White House demand to pay for a border wall, President Donald Trump now wants to not only negotiate the North American Free Trade Agreement but impose a 20% tariff on good imported from south of the border. After making extensive use of NAFTA to set up a network of manufacturing operations in Mexico, automakers could be among the hardest hit.
But there is, for now, widespread disagreement about how to respond to the Trump plan. Japanese automakers Nissan and Toyota say they are looking for ways to increase U.S. production. Ford’s CEO, after meeting with the new president this week, is rejecting the idea of building any new U.S. factories. Meanwhile, Fiat Chrysler’s chief executive says it may be time to rethink the possibility of a merger with domestic giant General Motors.