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The United States bought more goods from Mexico than China in 2023 for the first time in 20 years, evidence of how much global trade patterns have shifted.
In the depths of the pandemic, as global supply chains buckled and the cost of shipping a container from China soared nearly twentyfold, Marco Villarreal spied an opportunity.
In 2021, Mr. Villarreal resigned as Caterpillar’s director general in Mexico and began nurturing ties with companies looking to shift manufacturing from China to Mexico. He found a client in Hisun, a Chinese producer of all-terrain vehicles, which hired Mr. Villarreal to establish a $152 million manufacturing site in Saltillo, an industrial hub in northern Mexico.
Mr. Villarreal said foreign companies, particularly those seeking to sell within North America, saw Mexico as a viable alternative to China for several reasons, including the simmering trade tensions between the United States and China.
“The stars are aligning for Mexico,” he said.
New data released on Wednesday showed that Mexico outpaced China for the first time in 20 years to become America’s top source of official imports — a significant shift that highlights how increased tensions between Washington and Beijing are altering trade flows.
The United States’ trade deficit with China narrowed significantly last year, with goods imports from the country dropping 20 percent to $427.2 billion, the data shows. American consumers and businesses turned to Mexico, Europe, South Korea, India, Canada and Vietnam for auto parts, shoes, toys and raw materials.
I wonder how this trend will affect fuel use. Seems like a win for the environment.
Not really because a lot of the raw materials sourcing comes from the globalized marketplace still, so there’s still tons of shipping involved. If Mexico produced more raw materials, like fuck, half as much as China, then you might have an argument, but really what’s happening is that an extra hop is being added to the manufacturing process, so more fuel is being burned to deliver the same materials to Mexico so they can be assembled the same as before, then shipped to the next stop. Adding a transit hop from China to Mexico – requires crossing either the Pacific Ocean or the entirety of Eurasia and then the Atlantic – is inherently less efficient than doing the resource extraction and primary processing in the same country. Also, as the article itself points out, one of the main drivers of this trend is literally Chinese companies trying to evade US tariffs. Not actually a win for the environment.