Despite President Donald Trump's "America First" agenda, the Wall Street Journal reports year-over-year production of light trucks and SUVs in Mexico rose 16 percent during the first half of 2017.
President Trump has waged several attacks against Mexican car imports, but one in five cars built in the North America now comes from Mexico, the highest share in nearly a decade.
That surge is fueled by Americans' love for trucks and SUVs already built abroad.
“What all of the manufacturers ultimately have to do is make decisions based on the economics of what's going, because if you can't stay in business by making money then that's a real problem,” says Dr. David Cole, chairman emeritus of the Center for Automotive Research.
“Most of the domestic car companies aren't making any cars here at all,” he says. “They make those in places like China and Mexico because the margins are very small and the labor cost is a big deal in terms of profitability.”
Dr. Cole says the change Trump is calling for takes time.
“If you look at the product development process, if you look at making tooling and starting a factory, it takes years,” he says. “You really can't change laws on a whim without having a very serious negative impact.”
Cole says it's too soon to say whether recent figures will force the president into following through with threats of a tariff on foreign-made cars, but he expects changes to NAFTA will help level the playing field.