Two U.S. senators are urging the Commerce Division to launch a nationwide safety, arguing that offshoring manufacturing to Mexico is undermining U.S. manufacturing and jobs.
In a letter to Commerce Secretary Howard Lutnick, Sens. Tammy Baldwin, (D-Wisconsin), and Bernie Moreno, (R-Ohio), referred to as for a Part 232 investigation into heavy gear imports, together with agricultural implements, building and mining gear, forestry gear, heavy equipment and associated elements.
The request comes because the Trump administration prepares for a scheduled evaluate of the U.S.-Mexico-Canada Settlement later this yr and continues to depend on Part 232 nationwide safety investigations as a authorized pathway for tariffs on key industries.
Senators cite offshoring, job losses
Baldwin and Moreno mentioned main producers — together with Deere & Co., Caterpillar and CNH Industrial — have shifted manufacturing to Mexico whereas persevering with to promote gear into the U.S. market, a development they mentioned has value American manufacturing jobs.
The senators pointed to layoffs and plant closures tied to manufacturing strikes overseas, together with CNH layoffs in Wisconsin and a plant closure in Iowa, in addition to job cuts tied to Deere manufacturing shifts.
“These corporations shouldn’t be allowed to remove American jobs, pay Mexican employees poverty wages after which ship merchandise again to the U.S. for added revenue on the backs of our communities,” the senators wrote.
Additionally they argued that duty-free therapy beneath USMCA has incentivized producers to relocate manufacturing to Mexico, and mentioned any Part 232 motion must be paired with modifications to the commerce settlement.
Manufacturing footprint in Mexico expands
Main heavy gear producers have considerably expanded their manufacturing presence in Mexico over the previous a number of a long time.
Caterpillar operates dozens of amenities throughout Mexico, together with manufacturing, remanufacturing and elements distribution operations throughout a number of industrial sectors.
In line with firm info, Caterpillar has about 29 amenities in Mexico using roughly 14,000 employees throughout 21 campuses.
John Deere additionally operates a number of manufacturing amenities in Mexico and is increasing its manufacturing footprint, together with a brand new plant in Nuevo León scheduled to start operations in 2026 producing compact building gear for export markets.
CNH Industrial operates a serious manufacturing plant in Querétaro, Mexico, which serves as a key a part of its North American footprint, using over 1,000 folks. The power is a three way partnership with Quimmco Group and produces agricultural equipment, together with tractors and implements.
A nationwide safety investigation into heavy gear imports may result in new tariffs on equipment and elements transferring from Mexico into the U.S., probably disrupting cross-border provide chains tied to building, mining and agricultural gear.
Heavy equipment and elements are usually moved through cross-border truck and rail networks, significantly via Texas border gateways reminiscent of Laredo, which means any tariffs or commerce restrictions may have an effect on freight volumes, gear pricing and challenge prices throughout North America’s building and agriculture sectors.
The probe would mark the newest enlargement of Part 232 investigations into industrial sectors, following tariffs or investigations masking metal, aluminum, autos, vehicles and different strategic industries.
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