Arizona-Based Companies Export $250 Million in Automotive Parts to Mexico

In a recent article for Eller's Arizona-Mexico Economic Indicators project, Vera Pavlakovich-Kochi, senior regional scientist and associate professor of geography and regional development, reports Arizona-based companies exported close to $250 million worth of automotive parts to Mexico in 2018. Even with a decline in the last three years, the exported value in 2018 was about 170 percent above the 2008 level. This was faster growth over the decade than for the entire transportation sector (an increase of 141.5 percent), as well as exports of all Arizona commodities to Mexico (29.4 percent). Thanks to this more dynamic growth, the share of automotive parts increased in both the transportation products and exports of all commodities categories. Automotive parts accounted for more than 40 percent of all transportation products Arizona exported to Mexico.

However, North America’s new free trade agreement, recently signed, but not yet ratified, includes changes that particularly affect the automotive industry. Where North American assembly plants source key components will be central to determining where changes will be experienced. Of particular interest are three provisions with the potential to impact Arizona’s exports of automotive parts to Mexico: regional value content, labor-value content, and local content. 

Find out what might be at stake for Arizona’s economy under these new provisions, get the numbers, and read Professor Pavlakovich-Kochi's article New NAFTA, the North American Auto Sector, and Arizona: What Is and What Might Be.