Auto parts exports to Mexico stood at $834 million in FY25
| Photo Credit:
JOTHI RAMALINGAM B
After US tariffs on import of Indian auto components and cars, Mexico on Thursday imposed 50 per cent import tariff on these goods, sparking concerns for India’s automobile sector.
In financial year 2025, India’s automotive sector (vehicles plus components combines) exported around $1.95 billion worth of items to Mexico. According to industry sources, auto parts exports to Mexico stood at $834 million in financial year 2025 (FY25) and in the first half of FY26, it stands at $370 million.
According to industry sources, Skoda Auto Volkswagen India (VW branded cars) is the biggest exporter to Mexico (around 45,000 cars in a year), followed by Hyundai Motor India (30,000 units), Kia (20,000 units) and Maruti Suzuki India (15,000 units) with a total estimation of one lakh cars this year. In 2024 calendar year, these companies exported around 95,000 vehicles to Mexico.
But a spokesperson at Skoda Auto Volkswagen India said there will be no impact to its business at the moment.
“Mexico has consistently been one of our important export markets, given the rising demand there and the traction of our India-made models. We are monitoring the situation continuously. For the moment, we have come to the conclusion that our business activities are not affected,” the spokesperson said.
In the two-wheeler segment, major exporters are Bajaj Auto, TVS Motor Company and Hero MotoCorp.
“Mexico’s revised import duties on non-FTA partners, including India, could add cost pressures for our exporters. ACMA remains hopeful that ongoing bilateral dialogue between our two governments will ensure stability and continuity in our growing automotive trade,” Vinnie Mehta, Director General, Automotive Component Manufacturers Association of India (ACMA), told businessline.
Immediate concern
According to Saurabh Agarwal, Automotive Tax Leader, EY India, the proposed import tariff by Mexico, particularly with its implications for the automotive sector, is an immediate concern that could significantly inflame global trade tensions.
“For Original Equipment Manufacturers (OEMs) and component manufacturers that have strategically routed exports to the US via the Mexican supply chain to benefit from the USMCA, this represents a sudden and costly disruption. In the short run, companies face a near-impossible task of abruptly re-engineering complex supply networks,” he said.
Agarwal said this friction will inevitably translate into operational disruptions, higher costs for manufacturers, and ultimately, an unwelcome price increase for the American consumer if not subsidised otherwise.
“However, this moment must be viewed as a catalyst for long-term resilience. The uncertainty underscores the critical need for a considered shift away from hyper-concentrated supply chains and explore alternative export markets. The industry must use this turbulence to accelerate the structural reimagining of their sourcing and manufacturing footprints, transforming a short-term crisis into a long-term competitive advantage,” he added.
Published on December 11, 2025
Rubi Schewe
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