June 24, 2025
June 25, 2025
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A fragile ceasefire in Iran and easing oil prices bring a brief calm after weeks of global tension. Hopefully, it marks the end of the storm. Markets seem to think so—U.S. indexes remain steady, and investors continue betting long-term.
At the same time, new U.S. tariffs on Mexican appliances, a looming tomato dispute, and stricter FMCSA rules are reshaping North American trade. Yet despite the noise, supply chains are adapting fast.
This month’s Cross-Border Market Update follows that contrast.
The signals are clear: trade isn’t breaking—it’s reorganizing. And those paying attention now will be ready for what’s next.
With Trump’s July 9 “Liberation Day” deadline approaching, Mexico and Canada are under pressure to finalize bilateral trade agreements—or face sweeping new U.S. tariffs beyond the current 10% baseline.
So far, only the U.K. has locked in a deal, and others—including Japan, Vietnam, and the EU—are scrambling to secure last-minute terms. Mexico is nearing a compromise that could phase out Trump’s 50% steel tariffs under a volume cap, while Canada is pushing to resolve its steel dispute to avoid escalation.
The White House has signaled some flexibility for countries showing progress, but businesses across North America are bracing for potential supply chain and pricing shocks. For Canada and Mexico, the clock is ticking.
On June 23, the U.S. slapped a 50% tariff on steel-based home appliances like refrigerators, ovens, and washers. Mexico—America’s second-largest supplier in this segment—now faces significant headwinds in a $9.46B export category. Exports were already down –1.6% in 2024, and Vietnam has been gaining market share. Northern Mexico’s white goods clusters could see sharp operational shifts.
Foreign direct investment in Mexico’s auto trade hit $2.14B over the last five quarters—74% of all investment in the sector since 2006—driven in part by the growing presence of Chinese brands and tariff-driven supply chain shifts. In Q1 alone, Mexico captured a record $1.08B, surpassing all of 2024.
But this surge is drawing scrutiny. U.S. labor groups and trade officials warn that Chinese investment may be using Mexico as a backdoor to sidestep tariffs and tap U.S. tax incentives under USMCA. As pressure mounts to contain China’s influence, the question is whether this boom will remain a short-term win—or fuel long-term trade tensions across North America.
A 20.91% anti-dumping duty on Mexican tomatoes could go into effect July 14 unless a new suspension agreement is reached. Mexico currently accounts for 86% of U.S. tomato imports—worth $3.2B in 2024. The U.S. International Trade Commission has opened a review, but unless it finds major changes in market conditions, duties are likely to return. Mexico’s government rem
Mexico’s medical device industry—exporting $15B annually, 90% of it to the U.S.—is urging officials to highlight supply chain interconnectivity in the 2026 USMCA review. Components often cross borders multiple times before assembly, making the industry highly dependent on regional integration. The sector sees this as a “win-win” for competitiveness rather than a threat to U.S. jobs.
In June, U.S. consumer confidence rose 16% to 60.5 points—its first increase in six months—according to the University of Michigan. The rebound follows April’s tariff shock and suggests Americans are adjusting, at least temporarily, to the new trade climate.
Still, the index remains 20% below late-2024 levels. Concerns persist around inflation, job prospects, and personal finances. While companies are cushioning the impact with existing inventory, looming July tariffs may test this fragile recovery.
At the Port of Los Angeles, signs of slowdown are unmistakable: nearly 20% of expected May ship arrivals were canceled, and the port is operating at just 70% capacity. Trucking firms like Redefined Transportation have slashed container volumes and cut staff. “It’s survival mode,” said VP Erick Gordon. With rising tariffs and erratic bookings, supply chains are struggling to keep up with the policy whiplash.
Mexico recorded $21.4B in foreign direct investment in Q1 2025—a new record. But beneath the headline, most of the capital came from companies already established in the country: 78% was reinvested profits. True new investment totaled just $1.58B, or 7.4% of the total—still low, but up 165% year-over-year. Manufacturing captured over 40% of FDI, led by sectors like automotive, electronics, and power generation. Yet over 80% of all funds flowed to just five states, exposing stark geographic concentration. The U.S. remained Mexico’s top investor, but its share fell to 39% from 52% a year earlier.
Mexico attracted nearly $37 billion in foreign investment in 2024—up slightly from 2023—even as global FDI fell 11% amid tightening capital flows in Europe and China. That drop marked the second consecutive year of global decline, according to UNCTAD. Despite slipping from 9th to 11th place globally, Mexico remained the second-largest FDI recipient in Latin America, just behind Brazil.
While FDI to Latin America and the Caribbean fell 12%, Mexico held firm—driven by strong inflows to manufacturing, logistics, and digital infrastructure. The country also ranked sixth among developing economies in announced digital economy projects, with $29 billion committed over the past five years.
According to Mexico’s Economy Ministry, the country’s consistent appeal stems from its strategic location, competitive costs, young workforce, and robust internal market. In a world where capital is growing more cautious and strategic, Mexico’s steady rise signals long-term investor confidence—even as the global investment landscape shifts.
Mexico continues to attract strategic investment as global manufacturers respond to geopolitical shifts and tariff uncertainty. In Nuevo León, Hengli Hydraulics inaugurated the first phase of a $325M facility in Santa Catarina, including plans for a global R&D center and an electronics division.
In Coahuila, Swiss company Bühler broke ground on a high-tech plant focused on food and advanced materials processing, with a projected 500 direct jobs. And in Yucatán, Heineken announced a $2.75B national investment through 2028, anchored by a new brewery expected to create over 3,000 jobs.
Nuevo León alone captured $2.67B in IED through May—already 27% more than all of 2024. In contrast, Querétaro reported a 53.6% drop in IED for Q1 2025, highlighting growing regional imbalances in investment flows.
And momentum continues: Ford, celebrating its 100th anniversary in Mexico, confirmed new investments in its innovation center in Tlalnepantla and manufacturing plants in Guanajuato, Sonora, and Chihuahua. While details remain undisclosed, the move signals confidence in Mexico’s role as a core production base
President Trump has approved a new high-tech freight corridor between Laredo and Nuevo León. Led by Green Corridors LLC, the project features elevated guideways, autonomous shuttles, and inland customs clearance to streamline cargo flows. It’s part of a broader push to modernize South Texas border infrastructure and reduce congestion at traditional ports of entry.
Starting June 23 and June 25, 2025, two key federal rules are being fully enforced—for the first time in years. Non-compliance could mean license downgrades or roadside shutdowns.
Effective: June 23, 2025
What fleets should do:
Effective: June 25, 2025
What fleets should do:
Recommendation:
For years, the biggest expense for Pacific Coast Producers wasn’t packaging—it was produce. But since the first wave of U.S. steel tariffs in 2018, the economics have flipped. Today, it’s the cans.
On June 23, President Trump’s administration doubled down, expanding steel and aluminum tariffs to 50% and extending them to everyday goods like food cans and beer containers. The move has reignited pressure across a quiet but foundational supply chain—one that packages everything from peaches to pet treats.
Roughly 80% of the tin-plated steel used for food cans in the U.S. comes from abroad. Most aluminum cans rely on imported virgin material. There’s no short-term domestic substitute—and the effects are already rippling. Pacific Coast expects its next order of tin cans could cost $40 million more. They plan to raise prices 10 cents per can just to stay afloat.
Food and beverage companies can’t absorb the shock. Smaller breweries are reconsidering bottles. Steel can producers won’t place new orders unless they’ve locked in customers. And despite claims that tariffs protect U.S. manufacturing, the number of tinplate production lines in the country has fallen from 12 to just 3.
The unintended outcome? Higher grocery bills, more plastic packaging, and even the risk of being undercut by cheaper canned imports from abroad.
As Matt Strong, CEO of Pacific Coast, put it: “We’re trying to save an industry that isn’t there.”
Behind the headlines on tariffs, trade routes, and supply chain resilience lies a quieter force reshaping the U.S. economy: a deepening labor shortage. As of mid-2025, the country is still missing 1.7 million workers compared to pre-pandemic levels. Labor force participation hovers around 62.5%—down from over 67% in 2001—with little sign of recovery. In manufacturing alone, roughly 400,000 jobs remain unfilled, and some companies report just one qualified candidate for every 20 postings.
Structural forces are driving the shortfall: record retirements, slower immigration, lack of childcare, and a generational shift toward flexible, entrepreneurial careers. Since 2021, over 5 million new businesses have launched annually. Vocational enrollment continues to decline—and in 30 states, there are fewer first graders than high school seniors.
Trump’s push to reindustrialize the U.S. is running headfirst into labor market reality. Without a deeper talent pipeline—via apprenticeships, immigration reform, or training investment—many reshored factories may sit idle.
The real challenge isn’t just hiring today. It’s preparing for a decade of demographic strain and digital disruption that will reshape how—and by whom—work gets done. While the U.S. struggles to fill high-skilled roles, neighbors like Mexico—with a younger workforce and growing vocational infrastructure—may quietly absorb the jobs America can’t staff.
