Less than half a year ago, Germany’s top auto lobbyist was still waxing lyrical about Mexico and the opportunities it presents.
“Mexico is a market with great potential and an interesting investment platform,” said Matthias Wissmann, the president of the Association of the Automotive Industry (VDA).
Mexico, he said, had negotiated free trade deals with more than 46 nations, which made it an ideal place from which to make cars for the U.S. market, he said.
Donald Trump has now put that business model at risk, by bedevilling it and threatening to slap punitive import tariffs on all manufacturers who use it as a production base for exports to the United States. In an interview published over the weekend, he extended that threat to German carmakers.
That also affects auto components suppliers that tend to follow the automakers wherever they go. And if they take a hit from Mr. Trump’s policies, it’s not German manufacturers like BMW, Daimler and Audi that will be affected. Ford, Fiat Chrysler and General Motors rely on the German suppliers, too.