Mexican and Canadian officials have been dropping hints that they’re not all that enthusiastic about the United States-Mexico-Canada Agreement (USMCA) since before Enrique Peña Nieto, Donald Trump, and Justin Trudeau all sat down to sign it in 2018. But just getting to that point required months of formal negotiations that rarely looked to be all that productive.
Sadly, things don’t seem to have changed now that the USMCA is in full effect. Last week, Mexico requested a dispute settlement panel under the terms of the trade pact to help resolve disagreements about the surprisingly contentious automotive content stipulations that determine whether or not vehicles and parts will be slapped with tariffs. Under the previous North American Free Trade Agreement (NAFTA), 62.5 percent of the vehicle’s components had to be sourced from member nations to be considered tax-exempt. In an effort to spur localized production, USMCA increased that number to 75 and not everyone is thrilled with the updated content requirements with Mexico claiming it’s not even sure how to apply them. Canada now intends to formally sign onto Mexico’s complaint against the U.S. over their divergent interpretation of rules.
When the United States abandoned the North American Free Trade Agreement (NAFTA) to embrace the United States-Mexico-Canada Agreement (USMCA), it did so under the premise of crafting a better trade arrangement for itself. Established in 1994, NAFTA created a trilateral trade bloc that encouraged commerce between nations. But critics have accused it of encouraging the offshoring of U.S. jobs and dramatically suppressing wages — particularly within the automotive and manufacturing sectors.
Signed in 2018, and revised the following year, the USMCA was supposed to remedy those issues. But it’s been difficult to get all parties on board, especially when it comes to those persnickety rules of origin that stipulate how much of a vehicle’s hardware needs to be sourced from member nations.
Latest Car ReviewsRead more
Latest Product ReviewsRead more
- John I had an 87 escort GT that was silver, it was a fun little car and got 35+ mpg average, one time I got 42 average on a turnpike trip.
- Jho65697139 That's going to take a lot of buffing.
- Corey Lewis No need for unique qualifications to care for this thing, it's just a Corolla with a different body on it.
- Jeff S How's you Fiat doing?
- Syke Had the exact same car, only difference is that the trim was the JDM bB rather than the American xB. Enjoyed the car immensely, originally bought it because it was excellent for transporting my then-invalid wife and her wheelchair around. Best thing about it? I also owned a Porsche 924S at the same time. I could go from the Porsche to the Scion and not feel disappointed by the difference in the way they drove.