U.S.-Mexico tariff deal stalls after Commerce chief opposes deep cuts

Talks aimed at easing U.S. tariffs on Mexican steel aluminum and automobiles have stalled after Commerce Secretary Howard Lutnick opposed deep cuts to the levies people familiar with the negotiations said Thursday. Officials had been closing in on a package that would trim American duties in return for concessions from Mexico.

The United States still charges a 25% tariff on many Mexican-built automobiles and 50% on steel and aluminum including finished metal products. Mexican negotiators have pressed for relief arguing the duties raise costs for factories that supply both countries and for American buyers.

Where the talks broke down

Lutnick has resisted significant reductions in the auto and metals tariffs according to people briefed on the discussions. Other White House and trade aides had been more open to a deal that paired lower U.S. levies with Mexican steps on labor enforcement customs cooperation and rules of origin.

Neither government announced a collapse of the talks. People close to the process said meetings continue but Lutnick's opposition has slowed momentum that built over the summer. Commerce and Mexican trade officials did not issue a joint statement on Thursday.

Why it matters for factories and prices

Auto plants and steel users on both sides of the border have warned that prolonged tariffs keep prices elevated and complicate investment plans. Truck traffic at crossings such as Laredo's World Trade Bridge remains heavy as manufacturers move parts that face the higher rates.

Any eventual deal would need backing from both capitals and could still leave some duties in place. For now the stall leaves the current tariff schedule intact as companies plan production for the rest of the year and into 2027.

Trade watchers will look for whether Mexico offers new enforcement commitments that soften Lutnick's objections or whether the White House directs Commerce to accept a narrower cut. Until then steel aluminum and auto tariffs remain a central friction point in U.S.-Mexico commerce.