Dive Brief:
- Texas, Michigan and California would be the hardest hit by tariffs imposed on Mexican goods as President Donald Trump has threatened to put in place starting Monday, according to a new analysis from the U.S. Chamber of Commerce, which represents American businesses.
- All three of the most impacted states imported billions of dollars worth of goods from Mexico in 2018, and even the 5% tariff level would result in billions in extra cost that would have to be paid by either businesses or consumers, according to the Chamber's calculations.
- Electronics and motor vehicle imports make up much of this value, but many of the population centers in the U.S. also rely on food imports from Mexico.
Dive Insight:
Many of the Mexican imports into the United States make their way into the country on trucks at the Texas border. Many of those goods stay in Texas whether its automotive parts going to the Toyota plant in San Antonio or food heading to the grocery store.
Top 10 states affected by tariffs
| State | 2018 Imports | 5% | 10% | 15% |
|---|---|---|---|---|
| United States Total | $346,527,738,621 | $346,527,738,621 | $34,652,773,862 | $51,979,160,793 |
| Texas | 107,019,721,400 | 5,350,986,070 | 10,701,972,140 | 16,052,958,210 |
| Michigan | 56,270,594,079 | 2,813,529,704 | 5,627,059,408 | 8,440,589,112 |
| California | 44,053,811,838 | 2,202,690,592 | 4,405,381,184 | 6,608,071,776 |
| Illinois | 13,153,879,501 | 657,693,975 | 1,315,387,950 | 1,973,081,925 |
| Ohio | 9,195,910,421 | 459,795,521 | 919,591,042 | 1,379,386,563 |
| Arizona | 9,041,651,473 | 452,082,574 | 904,165,147 | 1,356,247,721 |
| Tennessee | 8,369,726,122 | 418,486,306 | 836,972,612 | 1,255,458,918 |
| North Carolina | 7,696,574,454 | 384,828,723 | 769,657,445 | 1,154,486,168 |
| Florida | 7,538,670,343 | 376,933,517 | 753,867,034 | 1,130,800,551 |
| Georgia | 6,945,990,818 | 347,299,541 | 694,599,082 | 1,041,898,623 |
SOURCE: U.S. Chamber of Commerce
Some people might be surprised at the state with the second largest financial tie to Mexico: Michigan. The auto industry in Michigan relies on cross-border trade with manufacturing facilities in Mexico that make automotive components.
"If we were to see 5% and then rising tariffs on auto parts and vehicles from Mexico, it would have a significant impact on the industry, ourselves included," Joe Hinrichs, Ford’s president, said at the UBS Industrials and Transportation Conference on Thursday, according to Bloomberg.
Marc Short, chief of staff to Vice President Mike Pence, told reporters Friday that paperwork will be filed today to impose tariffs Monday, but the negotiations will continue with the chance for them to be called off over the weekend, according to The Hill.
