On September 10th, Mexican President López Obrador officially submitted a tariff reform proposal, adding motorcycles to the list of goods subject to increased tariffs and explicitly imposing a 35% tariff on motorcycles from countries that have not signed free trade agreements. This policy is an important part of “Plan Mexico”, which covers 1,371 tariff codes of goods. Motorcycles are in the same 35% tariff bracket as steel, toys, and other categories. The new tariffs are expected to be fully implemented by the end of 2026, with an initial implementation period of two years, which may be extended in the future.

From January to August this year, Mexico remained the top exporter of motorcycles to China, with an export volume of 1.33 million units and an export value of 766 million US dollars, representing a year-on-year increase of 4.06%. However, Mexico’s proposed policy of imposing a 35% tariff on Chinese motorcycles will have a direct impact on both China and Mexico: For Chinese motorcycle enterprises, the 35% tariff will significantly reduce their price advantage and significantly increase their export costs. For the Mexican market, since China is its main source of motorcycle imports, it will be difficult to find alternative supplies in the short term, which may lead to changes in market supply, and the tariff costs may eventually be passed on to consumers.

The Ministry of Commerce of China has responded to this, stating that the unilateral tariff increase by the Mexican side will harm the interests of trading partners, affect the certainty of the business environment, and reduce enterprises’ investment confidence. China emphasizes that China and Mexico are each other’s important economic and trade partners. China opposes protectionism and hopes that the Mexican side will be cautious. It also stated that it will take necessary measures based on the actual situation to safeguard its own rights and interests. Currently, as the ruling party holds a majority in the parliament, the approval of this tariff proposal is highly likely. The subsequent impact remains to be observed.