U.S-Mexico Trade Tops $200B In Q1

Mexico's position as a trade powerhouse is solidifying. For the 13th time in the past 14 months, it remained the top trading partner of the United States, with a bilateral trade volume exceeding $68.5 billion in March 2024.

This dominance comes despite a slight dip (5%) compared to the same period last year. Throughout the first quarter of 2024, trade between the U.S. and Mexico reached $200.1 billion, showing a modest 1.7% year-over-year increase.

Image: Imports from Mexico and China to the USA. Source: Motive.

The U.S. is witnessing a decline in imports from China, marking a nearly 5% drop since 2019. This trend extends into 2024, with container shipments from China to the U.S. showing no signs of recovery.

Conversely, Mexico is experiencing a surge in Chinese imports, with a remarkable 37% increase since 2019. This trend continued in early 2024, with a staggering 60% jump in container shipments from China compared to 2023.

Mexico's trucking industry is experiencing a boom, with the number of companies increasing by 2.5% in 2023 alone and their fleets expanding by a significant 14%. This stands in stark contrast to the U.S. trucking sector, which has faced a decline of 6.6% in companies.

Image: Imports from China to Mexico. Source: Motive.

However, there's a reason both the U.S. and China might be looking at Mexico with growing interest: nearshoring. This strategy involves moving production facilities closer to the final destination (the U.S. in this case). 

Mexico is a prime beneficiary, attracting significant foreign investment, particularly in border states. This trend is strengthening Mexico's economy and its role in North American supply chains. We can expect even more Chinese investment in Mexico, which has already grown from $83 million in 2012 to $600 million in 2022.

The impact on trade is clear. U.S. imports from Mexico have been steadily rising, with a total increase of 33.1% by February 2024. This growth is happening on both land and sea routes. Mexico's trucking industry is booming too, with the number of companies going up by 2.5% in 2023 alone, and their fleets expanding by 14%. This stands in stark contrast to the U.S. trucking sector, which has seen a decline of 6.6% in companies.

Image: Authorized Carriers based in Mexico working in USA. Source: Motive.