Mexican auto parts manufacturer Nemak analyzing moving production to US

The menace of 25% tariffs connected car exports to the United States has prompted Nemak, among the world’s largest car manufacture suppliers, to see moving immoderate accumulation operations from Mexico to the U.S.

Nemak, headquartered adjacent the bluish concern metropolis of Monterrey, Nuevo León, is simply a planetary automotive parts shaper that specializes successful aluminum components. 

Auto parts shaper Nemak, headquartered successful Monterrey, has 37 factories successful 14 countries. (Nemak)

While delivering the company’s fourth-quarter net study past week, Nemak CEO Armando Tamez conceded that shifting immoderate operations to the U.S. is simply a possibility, but “only if it makes economical sense.”

This month, U.S. President Donald Trump ordered 25% tariffs connected each alloy and aluminum imports, applied past paused tariffs connected each goods imported from Mexico, and precocious suggested that tariffs would beryllium applied to each car imports opening connected April 2.

Tamez dismissed the interaction of the tariff threats, the paper El Financiero reported, citing ongoing commercialized negotiations betwixt Mexico and the U.S. Still, helium said, the institution indispensable analyse each imaginable scenarios.

Nemak supplies car parts to each large conveyance shaper operating plants successful Mexico, including General Motors, Ford, Toyota, Stellantis and Nissan.

Nemak cannot summation accumulation astatine its 2 plants successful the United States, according to CEO Armando Tamez. (Nemak Alabama)

If Nemak’s clients determination operations to the U.S. — Nissan is said to beryllium considering it — Nemak could person its car parts taxed straight nether the caller tariffs. 

Tamez said the institution presently has constricted capableness successful the U.S. and its plants determination — 1 successful Kentucky, the different successful Alabama — are incapable to summation production. 

“So if we were to determination operations to the U.S. from Mexico, it would person to marque economical consciousness for Nemak,” helium said, adding that prices would undoubtedly emergence due to the fact that “the outgo of doing concern successful the U.S. is higher than that successful Mexico.”

Nemak has 7 facilities successful the authorities of Nuevo León and 2 others successful the authorities of Coahuila. It besides has aluminum recycling and remanufacturing operations successful Nuevo León.

Earnings study overshadows Nemak’s realignment strategy

In its 4Q net report, Nemak, a subsidiary of the Mexican concern conglomerate Alfa, disclosed that though gross grew by 6% year-to-year to US $1.2 cardinal successful the last 3 months of the year, institution gross was down 1.7% successful 2024. 

While analyzing a partial determination to the U.S., Nemak is amid a strategical accommodation to its operations that seeks “to align its resources and investments with changing marketplace demands and lawsuit needs.” 

In aboriginal January, the institution postponed caller facilities successful Mexico and Germany. These paused operations were to impact the accumulation of artillery housings for afloat electrical vehicles wrong the e-mobility, operation and chassis applications, according to Mexico Industry.

With reports from El Financiero, Mexico Industry and Bloomberg News