China warns Mexico to ‘think twice’ before raising tariffs, threatens countermeasures

## China Warns Mexico Over Proposed Car Tariff Hike

China is strongly objecting to Mexico’s plan to significantly increase tariffs on cars imported from Asia, particularly China. This move could escalate trade tensions between the two nations.

• Mexico’s Plan: Mexico intends to raise tariffs on Asian-made cars from 20% to 50%, pending Congressional approval.
• China’s Response: China’s Ministry of Commerce has warned Mexico to reconsider, emphasizing the importance of their trade partnership and hinting at potential countermeasures.
• Trade Context: Mexico benefits from the USMCA trade agreement with the U.S. and Canada, but this agreement requires a higher percentage of vehicle parts to be made in the region.
• Investment in Mexico: Chinese companies have invested billions in Mexico’s auto industry, making it a key destination for Chinese car exports.
• Market Dynamics: Experts suggest that Chinese cars are primarily taking market share from other Asian brands in Mexico.
• Potential Impact: Even with increased tariffs, the value proposition of Chinese cars may remain competitive.

For more details, you can read the original article on CNBC: [Link to CNBC Article](https://www.cnbc.com/2024/06/21/china-warns-mexico-over-proposed-car-tariff-hike.html)