Fitch Ratings warns of uncertainty for Mexican businesses due to US election

The outcome of the United States elections may impact Mexican businesses due to their strong trade ties with the neighboring country, warns Fitch Ratings.

According to the international rating agency, Mexico's exports to the US account for over 30% of its GDP, making it vulnerable to tariffs or protectionist measures.

A bilateral push for trade protectionism and rebuilding the US manufacturing base could increase risks for Mexican companies. However, Fitch-rated Mexican corporates have healthy financial profiles and benefit from near-shoring trends, it stated in an analysis.

Mexican auto suppliers such as Nemak and Metalsa face significant exposure due to potential tariffs. Increased trade friction could reduce consumer spending, affecting retail, real estate, and food sectors.

Mexican companies have low leverage and adequate liquidity to weather these challenges. Near-shoring trends offer growth opportunities, but infrastructure, labor, and security concerns may hinder progress, according to Fitch's report.

The US-Mexico-Canada Agreement (USMCA) provides some protection, but changes are likely to occur during its 2026 review. Scenario analysis by Fitch's economics team shows aggressive unilateral tariff hikes could lead to a 0.2% to 1.9% reduction of Mexico's GDP.

Mexican companies' diversified manufacturing and transport sector has relatively high rating headroom. The chemicals sector has high leverage due to cyclical weakness but balanced against leading market positions.